What Car Insurance Coverage Do You Need?

We have four auto insurance FAQ pages, for your browsing pleasure.

Choosing levels of coverage is the trickiest part of auto insurance. We hope these answers help you nail down your specific needs.


1. How much liability car insurance do I need?
2. Do I need medical payments or PIP coverage?
3. Do I need uninsured and underinsured motorist coverage?
4. How much auto insurance coverage is required in my state?
5. How high should I set my deductible?
6. Do I need special coverage if my car is leased?
7. Do I need to get auto insurance before I buy a new car ?
8. How much insurance do I need on a used car?
9. Do I need to purchase auto insurance coverage in a different state if I'll be living there temporarily?
10. Can I temporarily suspend my auto insurance if I won't be driving my car for a while?
11. Do I need an umbrella policy?

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1. How much liability car insurance do I need?
As much as you can afford. Liability is probably the single most important policy you carry on your car, especially if you have a lot of assets to protect. What's more, a big increase in protection translates into a relatively small increase in your premium. So you get a lot more security for a little extra cash.
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2. Do I need medical payments or PIP coverage?
It depends. If you have good health insurance, you may not. Many of the same events that medical payments covers will already be covered by your health plan. On the other hand, passengers in your car (other than family members) usually won't be covered by your health insurance but will be under a medical payments policy. If you live in a no fault state, you'll probably need PIP to be covered for pain and suffering, lost wages, and medical expenses. (And it will usually be required by law.)
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3. Do I need uninsured and underinsured motorist coverage?
We think it's a good idea. Around 14% of drivers nationally are driving without insurance, and uninsured coverage is your only protection against them. We recommend you carry the same levels of these coverage as you do in liability.
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4. How much auto insurance is required in my state?
Click here for a list of all state auto insurance requirements.
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5. How high should I set my deductible?
As high as you comfortably can. A small increase in your deductible can allow you to make a big increase in more important coverages, like liability.
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6. Do I need special insurance if my car is leased?
You might. You'll probably be required to carry comprehensive, collision, and maybe auto gap insurance. Check with your lessor for any special requirements.
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7. Do I need to get auto insurance before I buy a new car?
If it's your first car, yes. If you already own an insured vehicle, your current policy will cover the new car for thirty days. But you'll have to have collision and comprehensive already. And tell your insurer about the new vehicle as soon as possible!
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8. How much insurance do I need on a used car?
You should carry the same levels of liability, medical, and un/underinsured motorist coverage as you would on a new car. But collision and comprehensive are optional. If the car isn't worth much, it may not be worth in the premiums on these policies to insure it.
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9. Do I need to purchase auto insurance in a different state if I'll be living there temporarily?
If your stay will be six months or fewer, probably not. You'll be covered under your old policy. Any longer, and you might want to switch.
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10. Can I temporarily suspend my auto insurance if I won't be driving my car for a while?
It may be more hassle than it's worth. You might have to reapply for a policy, and some companies charge higher rates if you haven't held continuous coverage for a while. And if your car is financed, the lien holder may require that you maintain coverage on the car whether you expect to be driving it or not.
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11. Do I need an umbrella policy?
If your assets are considerable, yes. We suggest an umbrella policy for anyone with assets over one to two million dollars, though some may be comfortable with more or less protection.
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