How Much Car Insurance Do I Need?
Posted on: April 19, 2023“How much car insurance do I need?”
It’s a question we get a lot at Beers & Gordon and it’s a very important one.
We all buy car insurance to protect us from the many dangers that exist on the road. Yet all too often, car insurance coverage is not enough to cover the cost of mounting medical bills (not to mention lost wages).
In such cases, a car accident attorney may help you receive the compensation you need to fully recover from your injuries. But purchasing adequate auto insurance coverage from the start can make the entire process easier.
Depending on who you ask, you will receive many different answers to the question “How much car insurance do I need?” Your insurance carrier may give you one answer; Florida law will give another.
Allow us to give you our perspective on car insurance as a personal injury law firm.
Florida Car Insurance Requirements
According to Florida law, drivers are only required to carry two types of insurance.
- At least $10,000 of Property Damage Liability (PDL) coverage
- At least $10,000 of Personal Injury Protection (PIP) coverage
Property Damage Liability (PDL) is designed to cover property damage caused by you (or someone driving your vehicle).
Personal Injury Protection (PIP)—also known as “No Fault insurance”—covers 80% of your medical bills and 60% of lost wages resulting from a car accident, regardless of who was at fault.
It’s important to note that, even with PIP coverage, you will still have to cover the cost of the remaining 20% of your medical bills and 40% of your lost wages out of your own pocket.
You Need More Car Insurance Coverage!
Ask any personal injury attorney (or insurance agent, for that matter) and they’ll tell you that Florida’s requirements for auto insurance are woefully low.
After all, $10,000 in coverage is next to nothing when the average new car costs more than $40,000.
Neither PDL nor PIP coverage will protect your assets or replace your car if you get into an accident. Your own injuries are (partially) covered, but you would have to pay out of pocket for any injuries you cause to others.
Let’s face it, if an accident is severe enough to damage someone’s vehicle, it’s probably severe enough to injure the people inside it.
Car accidents might be common, but they are not commonplace. It is impossible to predict when an accident will occur or how severe it will be, so your best bet is to be prepared with adequate auto insurance.
How Much Car Insurance Do I Need?
In order to fully protect your assets, you need to purchase more than the required minimum of car insurance.
There are a wide variety of policies available and many of them are completely optional. However, there are two forms of car insurance coverage that you should have, especially if you live in Florida.
Bodily Injury Liability (BIL) coverage is designed to cover injuries that you cause to others. It can also cover your own legal fees if you are sued after an accident.
Other than Florida, all states require drivers to carry some level of BIL coverage, which should give you some indication of how important it is. We would love to see Florida join with the other 49 states and require everyone to carry this coverage to protect you.
Another vital form of car insurance coverage is Uninsured/Underinsured Motorist Coverage (UM).
Despite the legal requirements involving car insurance, an estimated 20% of Florida drivers are uninsured. UM coverage will cover the cost of past and future medical expenses, lost wages, loss of earning capacity, and pain and suffering that the at-fault driver’s insurance cannot. Because Florida is the only state to allow policies with no bodily injury coverage, this coverage is even more important.
In Florida, you are required to purchase BIL coverage in order to purchase UM coverage, so both of these policies are equally important.
It’s also important that you stack your Uninsured Motorist coverage to get the most use out of it.
How Does Insurance Stacking Work?
Insurance stacking allows you to add one car’s insurance coverage onto another car’s coverage to increase your policy limit in the event of an accident.
For example, say you have two vehicles on your policy, each with a limit of $50,000 per person and $150,000 per accident. If you stack this policy and get into an accident with an uninsured motorist, you could “stack” the limits and have a total of $300,000 in coverage.
Under Florida law, UM coverage is automatically stacked when you purchase it, but drivers are able to opt out of it in exchange for a lower premium.
If you are unsure of whether you stacked your UM coverage (or whether you have this type of coverage at all), we highly recommend that you contact your insurance company or agent as soon as possible.
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Other Car Insurance Policies To Consider
The importance of bodily injury liability and uninsured motorist coverage cannot be overstated, but if you want to fully protect your assets (your car as well as your bank account), there are a few other policies you should consider.
Comprehensive and Collision
Both comprehensive and collision coverage will repair or replace your car if it is damaged, but at different times and for different reasons.
Collision insurance covers damage to your car if it’s involved in a collision with another vehicle or object. Comprehensive coverage protects you from damage caused by any other (covered) damage, such as theft or fire.
MedPay
As we discussed earlier, Florida drivers are required to purchase $10,000 in Personal Injury Protection (PIP) to cover medical bills and lost wages if they are injured in an accident. However, PIP only covers 80% of your medical bills.
MedPay may cover the remaining 20% not covered by PIP. In some cases, it may even continue paying once the $10,000 limit has been met.
Umbrella Policy
An umbrella policy increases the limits on liability coverage (such as property damage liability and bodily injury liability). Depending on the policy, it can also increase your underinsured motorist coverage.
With the costs of both vehicles and healthcare continuing to rise, an umbrella policy can come in handy. Additionally, if you have any collectible assets, this coverage will be vitally important.
Conclusion
Ultimately, the best answer to “how much car insurance do I need?” is simple: as much as you can afford.
Car accidents can happen at any time and the best idea is to prepare for the worst. You need to protect yourself against you causing an accident and need the same protection against those that injure you.
While there are some car insurance policies that are not the right choice for every driver—such as gap insurance—Bodily Injury Liability and Uninsured Motorist coverage are not among them. Every Florida driver should carry these two forms of coverage to be protected in the event of a car accident lawsuit.
No matter what comes your way, the car accident attorneys at Beers & Gordon are here for you. Whether you are in a dispute with your insurance company or another drivers’ insurance, we’ll fight to make sure your rights are represented and that you receive fair and just compensation for your injuries and damages.
Call Beers and Gordon today to schedule your free consultation.
Jim Gordon
Jim Gordon earned his Juris Doctorate from the University of Nebraska in 1997, and two years later began working at a firm in Orlando handling insurance defense matters on cases involving vehicle accidents, negligence, product liability, and more. He established Beers & Gordon P.A. with David Beers in 2009 to represent the rights of people injured because of negligence. He is a member of the invitation-only National Trial Lawyers organization and the Million Dollar Advocates Forum.
