Author Topic: Auto insurance limits?  (Read 5536 times)

rayt168

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Auto insurance limits?
« on: May 03, 2014, 07:04:58 AM »
Hello,

In an effort to reduce my bills, I have been putting everything under a microscope.  I am reviewing my auto insurance policy.
My auto insurance limits are as follows
* bodily injury = 100K each person / 300K each accident
* property damage = 100K each accident

I have two cars and also have my homeowners' insurance with the same company as well. 

The reasoning for setting my limits on the high side was that insurance would cover up to these limits if I was liable and that I would be responsible for anything over the limit. 

I was curious as to what other people did on their policy limits.  Do you max out on the liability in an effort to protect yourself or do you just take a chance that you would not be at fault (I realize most people are responsible)?  Any feedback would be appreciated.





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Re: Auto insurance limits?
« Reply #1 on: May 03, 2014, 08:20:55 AM »
I used to have my liabilities set to the state minimum, but since my net worth is pretty high now, I took the advice of other MMM posters and increased it to about mid range that should cover most instances of a accident. The husband and I are very cautious drivers, and don't actually drive much other than work commutes (which are not freeway driving), and hardly ever at night. I'm counting on us not being at fault for the most part which was my reasoning for having the lowest coverage, but as I have more to lose, I wanted a bigger cushion just in case.

One of the ways I reduced our insurance (both home and cars) was to drop full coverage on an older vehicle and raise our deductibles to the maximum allowed - both for house and cars - since we could easily afford the higher level in the (hopefully) unlikely event of a claim. We also made sure that medical wasn't included for ourselves since we have good medical insurance already (which I'm not sure is a good idea or not, but again, taking the gamble that we won't have to find out). I'm currently debating the when to drop full coverage on a year old vehicle since we could outright replace it in the event I did something that totaled it... but I'll probably wait another year or two before dropping that down.




Heather in Ottawa

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Re: Auto insurance limits?
« Reply #2 on: May 03, 2014, 08:30:04 PM »
Minimum liability required by law ($200,000 for car insurance, some equally ridiculous number that came packaged with basic homeowners policy that we haven't tried too hard to get out of (yet). We simply don't do anything we would be 'liable' for. Drive 100% law-abiding (on low risk roads), good, careful, defensive drivers (riding a bike seems to be the key to being a good driver, imo), keep our walks shoveled and salted, and don't let dead trees go unattended. My understanding is that you have to have done something at least a little negligent before you can be successfully sued. No negligence, no worries. 

CarDude

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Re: Auto insurance limits?
« Reply #3 on: May 03, 2014, 08:56:22 PM »
Minimum coverage here, but as you might imagine from the username and blog, I take driving very seriously.

brewer12345

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Re: Auto insurance limits?
« Reply #4 on: May 03, 2014, 09:08:41 PM »
You people are nuts.  If you  have a pot to piss in an you live in the litigious US of A, you need a minimum of a $1MM umbrella policy and whatever underlying auto and homeowners' limits are required by the umbrella insurer.

Greg

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Re: Auto insurance limits?
« Reply #5 on: May 03, 2014, 09:45:47 PM »
We simply don't do anything we would be 'liable' for. Drive 100% law-abiding (on low risk roads), good, careful, defensive drivers (riding a bike seems to be the key to being a good driver, imo), keep our walks shoveled and salted, and don't let dead trees go unattended. My understanding is that you have to have done something at least a little negligent before you can be successfully sued. No negligence, no worries.

Most accidents are accidental, meaning either something happens you didn't expect, notice or otherwise help happen (though this can be argued since most "accidents" are preventable). 

No one is 100% law-abiding, but that's beside the point.  My point is that an accident could occur and you could be help liable for more than your coverage.  Consider a situation where the driver in front of you brakes suddenly for an animal or road hazard that you can't see.  You rear-end them, you're pretty much automatically liable.  If this happens to an expensive car and there are old people and kiddos in the car you will max out your limits.

We used to carry the minimums until my wife had an accident and then I realized the minimums are a joke in terms of personal injury liability.  Extra liability costs very little.

Nords

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Re: Auto insurance limits?
« Reply #6 on: May 03, 2014, 11:10:14 PM »
I was curious as to what other people did on their policy limits.  Do you max out on the liability in an effort to protect yourself or do you just take a chance that you would not be at fault (I realize most people are responsible)?  Any feedback would be appreciated.
We don't insure for collision or comprehensive, but we max out on liability (and property damage/personal injury) as well as UM/UIM. 

You people are nuts.  If you  have a pot to piss in an you live in the litigious US of A, you need a minimum of a $1MM umbrella policy and whatever underlying auto and homeowners' limits are required by the umbrella insurer.
Like the man says, liability insurance is cheap.  We carry a little more liability insurance than our gross worth, because the jury doesn't care how much mortgage debt you carry.