What I Didn’t Know About Auto Insurance
Will state minimum limits keep you safe?
You’ve heard the saying, “Ignorance is bliss.” In the insurance world, nothing could be farther from the truth. I will forever remember the first time I dealt with insurance. I had just got my license and was ready to be out on the road. The thrill of independence and responsibility was pulsing through the steering wheel of my 1994 Honda Accord. I was young and foolish. However, I at least had the common sense to purchase auto insurance before I got out of the road. However, that common sense didn’t last long. I will always cringe at the answer I gave to the agent on the other side of the phone. He asked what kind of limits of insurance I’d like to carry. “Just make it cheap and legal,” I replied. Brilliant!
Fast forward a year when I started my second job at a local independent insurance agency. It didn’t take long for me to realize that I had exposed myself to enormous risk by carrying state minimum limits. Wisdom is gained through your own experience or the experience of others. Thankfully, I was lucky enough to learn from the shocking statistics of those who had gone before me.
7% of Indiana Drivers are Uninsured
..according to a 2015 study by the Insurance Information Institute. Indiana ranks at #8 in the nation for the most uninsured drivers. This was very disconcerting for a young man with state minimum uninsured motorist coverage.
Claim Settlements are Increasing Significantly
With the rise of drivers who text, the sophistication and complexities of modern vehicles, along with other variables, studies are showing that the average settlement continues to increase with each year. This did not bode well for my state minimum policy.
What Goes into Bodily Injury Coverage?
Until I started in insurance, I had little concern about exceeding my liability limits. I realized that Bodily Injury can include the obvious, such as surgeries and hospital bills, but it can also include things such as lost wages, ongoing physical therapy, punitive damages, and pain and suffering. My state minimum limits were looking worse and worse.
78% of Drivers have Admitted to Using Facebook While Driving.
That is an astonishing number. The good news is that this statistics means only 22% of drivers are liars. All kidding aside, this is a reason for alarm. My chances of being involved in a serious accident are on the rise as well, with increasing distractions.
The Reality of Subrogation
Subrogation is defined as, “the substitution of one person or group by another in respect of a debt or insurance claim, accompanied by the transfer of any associated rights and duties.” This essentially means that if I am at fault in an accident, and my liability limits are exceeded, my insurance company may pay the claim, but then they are coming after me for the rest. That is a sobering thought when you have state minimum limits.
Indiana is the 5th least expensive state for auto insurance
..according to a 2014 study by the Insurance Information Institute. There are many reasons to love Indiana. One reason is that it is a great place to buy auto insurance! This means that I can afford to get the protection I need, so I don’t find myself in a hole later on!
Hopefully, I have encouraged you to take a look at your insurance to make sure you are properly protected. If you need any help looking at your coverage, don’t hesitate to give us a call!