With more people driving than ever before, the chances of having a car accident have raised significantly over the last twenty years. More people also use cell phones while driving, which means an added distraction on the road, and an increase in their chances of having an accident. With the added road population and new hazards, the consumer should consider increasing her auto insurance liability limits. Consumers will find the increase will not raise their car insurance rates as much as they think it might. In fact, consumers can shop for the cheapest car insurance and still increase their liability limits without breaking their wallet.
The consumer should first consider the reasons to increase her liability limits. Having a car accident is frightening enough for an individual, without finding out later the party at fault does not have adequate car insurance to cover your costs. If the consumer does not have adequate insurance coverage to meet the demands of the injured party’s claims, the additional costs will have to come out of personal funds. This can often leave the defending party in dire financial straits. Conversely, if the defending party does not have enough money in personal funds to cover the injured party’s cost, these costs become the burden of the already strained health care system, which is part of the reason health care premiums are rising. Subsequently, the burden of the payment the defendant cannot make up falls on the shoulders of health insurers like Medicaid and SeniorCare, making health care premiums go up, which then makes health care insurance unobtainable for some. If the consumer’s car insurance rates are already low, increasing liability limits may raise her premiums some, but it could help keep her health and auto insurance premiums lower over the long haul.
As well, state required minimums for liability limits have not been adjusted, in some cases, since the 1970s or early 1980s, so they have not kept up with the current purchasing power of the American dollar. Some liability limits are as low as $25,000 to 50,000 dollars, whereas awards for injured parties in automobile accident cases can be as high as 1 million dollars. If a minor drives the vehicle, the chances of the vehicle being in an accident are greatly increased. Car-pooling and daily commuting also raise the consumer’s potential for accidents.
Doubling, or even tripling, liability limits will not double or triple a consumer’s car insurance rates either, and adjusted premiums often cost less than a set of winter tires. Factoring in what an accident could cost, it pays to look for the cheapest car insurance that offers increased liability coverage.