Does Your Auto Insurance Policy Fully Protect You and Your Family?

Across the country, auto insurance premiums are up 23% over the last five years for the average driver.  A 40-year-old-male typically pays between $1,510 to $2,700 per year in premiums.  Due to these increased costs you may be thinking of ways to reduce your annual premium costs; however,  be careful not to cut corners so much that you fail to protect yourself and/or your family.  In regards to policy liability limits, insurance analysts recommend at least $100,000 per person / $300,000 per incident.  The state of Michigan only requires drivers to get $20,000 in coverage but this is far too low to protect your assets from a personal injury lawsuit.  If your insurance policy limit does not cover all the pain and suffering damages awarded in a lawsuit then Michigan law allows the injured party to collect from your personal assets. 

                           

Additionally, be sure to have a policy that has Uninsured Motorist (UM) and Under-insured Motorist (UIM) riders to protect you and your family.  Studies show that one in seven drivers drive without any insurance coverage.  Oftentimes, these uninsured drivers get insurance for only a few months or weeks so they can get their state registration and then they allow their insurance to lapse and continue to drive uninsured for 10 months or more of the year.  With around 14% of drivers being uninsured, you really need to have UM and it is relatively inexpensive.  Additionally, many other drivers will get the minimum $20,000 liability coverage.  If you or your family member are seriously injured by a driver with inadequate limits and that driver also has no assets that can be collected against, then this can lead to serious damages being uncompensated.  It makes sense to also get the UIM coverage.  Insurance analyst recommend $100,000 per person and $300,000 per accident in UM / UIM coverage.  These insurance specialists find that these policy limits will cover additional damages in all but 5% of accidents.