3 'Optional' Auto Insurance Protections That Might Not Be Optional for You

Nearly all states require their drivers to have some auto insurance to get behind the wheel. But required coverage is usually limited to liability insurance, which protects other drivers if the policyholder hits them. All drivers are able to add extra protections if they want, but these are usually optional.

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However, there are cases where drivers might be required to purchase additional protections to avoid serious financial consequences. Here are three you need to know about.

1. Collision coverage

Collision coverage pays for repairs to the policyholder’s vehicle if they cause an accident or are involved in a single-car accident. It’s not something required by any state law. But lenders and lessors often require it of their drivers to protect their investment.

Even if you’re not required to have it, it’s often worth getting. Should you get into an accident without it, you’ll have to pay for the repairs entirely out of your own pocket. Or if your car is totaled, you’ll be on your own as far as buying a new one.

2. Comprehensive coverage

Comprehensive coverage goes hand in hand with collision coverage. This auto insurance protection pays for damages due to theft, vandalism, bad weather, and animal-vehicle collisions. Again, this applies to the policyholder’s own vehicle. Damages the policyholder causes to other vehicles are covered under liability coverage.

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This is another insurance protection that lenders and lessors almost universally require their drivers to carry. It ensures that they still get their money back even if the vehicle is damaged or lost for a reason other than an accident with another vehicle.

3. Uninsured/underinsured motorist coverage

Uninsured/underinsured motorist coverage pays for the policyholder’s medical expenses and vehicle repairs if they’re hit by another driver who is either operating illegally without insurance or whose policy limits aren’t high enough to cover the full cost of the damages. It’s usually optional, but there are some states that require their drivers to carry this.

You don’t need to keep track of whether you’re required to have it or not. When you get an auto insurance quote, the company will automatically include uninsured/underinsured motorist coverage if your state requires it. Legally, insurers cannot sell you less than your state’s minimum coverage requirements.

How to find a good deal on car insurance

Adding extra protections like those discussed above could save you quite a bit of money, but it will also raise premiums. That can be difficult for drivers who are already on a tight budget. The following tips can help:

  • Shop around. Compare rates from several top auto insurance providers before purchasing a policy. Each company has its own algorithm for evaluating risk, and this can result in wildly different quotes for the same customer.
  • Claim all possible discounts. Getting more discounts isn’t always indicative of a lower premium. But it doesn’t hurt for drivers with special situations, like owning an EV, to seek out insurers that reward them for it.
  • Raise the deductible. Raising the policy’s deductible lowers monthly premiums, but it also means higher out-of-pocket costs in the event of an accident. It’s helpful to budget for this in an emergency fund before going ahead with the deductible increase.

If premiums still aren’t all that affordable even after trying the tips above, you might want to try searching for coverage again in a few months to see if there’s anything cheaper out there. It might not be the most fun way to spend an afternoon, but it certainly beats budgeting for an expensive vehicle repair all on your own.

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