Auto insurance isn’t a one-size-fits-all service. What works best for your friends and family may not be right for you. Therefore, when searching for a new auto insurance policy, it’s very important to get the right plan for your own specific needs. However, there are certain types of car insurance everyone should avoid.
These plans are those that leave you at risk for potentially significant out-of-pocket costs in the event of an accident. When you purchase car insurance, the goal should be to get a plan you can afford that covers enough to ensure you never have to worry about going broke should your car get damaged.
Liability Required by Law
Liability insurance is required by Kentucky state laws. Every driver must have the bare minimum 25/50/15 liability insurance. What this means is your policy must have at least $25,000 of bodily injury for one person injured in the accident, $50,000 for bodily injury for everyone injured in the accident, and $15,000 for property damage.
Carrying less insurance could cost you big time. If you get pulled over, Kentucky fines are massive for under-insured drivers. Liability insurance only covers damage to property and other vehicles and drivers. It does not cover damages to your own vehicle. Full coverage insurance is recommended, even though it is more expensive.
Comprehensive Insurance (Full Coverage)
Comprehensive car insurance covers liability plus damage to your own vehicle in the event you are the at-fault driver. If you have a car loan, the loan company will likely require you to obtain full coverage. The reason they do this is to ensure drivers don’t skip out on paying the remainder of the loan following a major accident.
If you don’t get full coverage insurance, the loan company may repossess your car, so make sure you follow their requirements. We’d hate to see anything like that happen to you due to a misunderstanding.
What if you don’t have a loan and own the vehicle outright? In this case, collision coverage (full coverage) may be unnecessary. To determine if you still need full coverage, first consider the estimated current value of your car. If the premiums are more than 10% of the value, you should stick with liability. But if the value of your car is higher, it would be unwise to refrain from purchasing comprehensive auto insurance.