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Auto Insurance: How Much Should You Buy?

By October 9, 2014May 21st, 2020Insurance
Totaled Car


Most states require you to have auto insurance. But they don’t require you to have much. In states that have so-called mandatory auto insurance laws, all you are required to buy is a little bit of liability coverage. This is so you can pay for some of the damage your car does to other cars and other people who are not in your car.

How much are you required to buy? Florida has a mandatory auto insurance law, and the minimum needed is liability that provides 1) $10,000 for any person involved in an accident with you, 2) a maximum of $20,000 for all persons in the accident, and 3) $10,000 for damage to the other vehicle(s) involved. That’s not much. In fact, it’s next to nothing.

* Tip. The minimum amount of insurance required by most states (especially Florida) is not much. Seriously consider getting more coverage in order to protect your financial health.

* Note. Notice that mandatory auto insurance laws do not require you to buy coverage for your own car, or coverage for your injuries, or coverage if you are hit by someone who doesn’t have insurance.

If you buy just the minimum coverage required by law, you are leaving your assets at considerable risk. At risk are your car (obviously) and your home, if you are at fault in an accident that causes serious injuries to the other parties.

How far do you think $10,000 will go if you total somebody’s Mercedes or Lexus? Not far enough!