In our summer newsletter, we discussed ways you can lower the premium on a minimum coverage auto insurance policy, and offered advice on increasing areas of coverage that otherwise could leave a minimally-insured Florida driver extremely vulnerable in the event of an accident.
What if you’re willing to spend a bit more in order to make sure your family is well-covered for practically any circumstance you could encounter on Florida’s roads? What types of coverage would a good, yet affordable, auto insurance policy offer?
Before we dive in, we want to make you two promises. First, we will try to explain things in a way that won’t make your eyes glaze over in boredom (not an easy thing to do when talking about auto insurance, but we will do our best). The second promise is that understanding and acting upon everything that follows could save you from financial ruin and mountains of otherwise undue stress should you end up in a serious traffic accident — especially one that is your fault. Remember, knowledge is power; thinking you are protected without actually knowing you are protected is one of the costliest mistakes Florida drivers can make.
So what is “affordable” auto insurance?
Everyone has a different budget and a different idea of what is affordable. With insurance, one should not just consider the amount of the monthly premium payment, but also try to factor in the cost of not having adequate coverage. Imagine a family with minimum coverage getting involved in an accident where several people are injured. With the staggering costs of healthcare, even modest medical bills can quickly engulf the coverage offered in a basic policy. For an insurance policy to be truly affordable, it should offer solid protection in the case of a more serious accident, but not break the bank with high premiums.
Let’s say you could afford $35 more a month for auto insurance over the most basic plan. What would you get for your money? Would it be worth it? To find out, let’s look at the most basic minimal auto insurance policy for a single, 35-year-old female driver with a good driving record and a newer-model sedan living in Sarasota, and compare the coverage differences with a policy costing $35 a month more for that very same driver. Ready? Here we go …
Bodily Injury Coverage
Bodily Injury (BI) insurance covers damages related to the injury or death of another driver or a pedestrian when the accident is your fault. A basic insurance policy covers up to $10,000 for an individual and up to $20,000 for an accident. Considering the average cost of a three-day hospital stay is around $30,000, it is easy to see that the basic coverage doesn’t cover much at all. But here’s the rub: You are legally responsible for everything beyond these limits. Our suggested $35 a month increase would raise those limits to $50,000 and $100,000 respectively.
What happens if another motorist hits your car and you and/or any of your passengers are injured? Florida is a no-fault state, so everything should be okay, right? Not by a long shot. The type of insurance that no-fault refers to is Personal Injury Protection (PIP). PIP only pays for medical care and a portion of your lost earnings following an accident. After that, the at-fault driver’s insurance kicks in and covers everything up to his or her policy limits. If that driver is underinsured or carrying no insurance, and you have only basic auto insurance coverage yourself, guess what? You’re on the hook for all of the medical expenses incurred by you and/or your passengers that are not covered by insurance.
Uninsured/Underinsured Motorist Coverage
We mentioned in our last newsletter that an estimated one out of seven drivers in the U.S. is not insured. This doesn’t account for drivers who carry only minimum limit liability policies (underinsured). In our Summer 2013 issue, we discussed how Uninsured or Underinsured Motorist (UM/UIM) insurance protects you and your passengers if you are struck by a driver who is underinsured or carries no insurance (uninsured). Basic auto insurance policies rarely, if ever, offer UM/UIM coverage, so not having it puts you and anyone in your vehicle at tremendous risk. The good news? For an extra $35 a month you can add UM/UIM insurance to your policy that has a limit of $50,000 for an individual and $100,000 for an accident. That’s a lot of peace of mind for just over a dollar a day.
Another great benefit of spending this extra $35 a month on auto insurance is that your policy will now allow “stacking.” If you own multiple vehicles and have multiple policies, you can collect UM/UIM from more than one policy, allowing you to, in most cases, receive full payment for your injuries and property damage even in the most serious accidents.
Has your idea of affordable auto insurance changed?
Would you spend an extra $35 a month to know that you, your passengers, and your property are well-protected should you meet with calamity on Florida roads? Knowing the outcome of being underinsured can certainly change one’s perspective. Knowledge is, indeed, power.
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Florida Auto Accident Recovery
If you have been involved in an accident or know someone who has, this helpful Ebook is full of useful information and tips that we’ve gleaned from years of experience in helping Florida auto accident victims. The guide is absolutely free and you can get yours HERE.
If you need immediate legal assistance, don’t hesitate to call us at (941) 365-2296 for a free consultation.