There are facets when considering your auto insurance needs.
A) What should my liability coverage limits be?
You have to balance how much you could afford to pay for in an accident over and above your coverage limits. If you have much liquid or loan able wealth, maybe you be fine with lower limits. But then again, you could afford good coverage!
The higher your liability coverage limits are, the more likely your policy will be able to pay all of the damages. So the answer really is "as much as you can afford to maintain"
B) Should I carry collision & comprehensive coverage?
The finance company will insist You have collision or comprehensive coverage if your car is leased or financed. Once you have paid off your car, and over time as its value decreases, you might consider dropping these coverages to lower your premiums.
Calculate the savings from dropping these parts of your insurance plan and if that would be worth paying the entire cost of repairing or getting a new car.
C) What kind of deductibles should you have on collision and comprehensive coverages?
Higher deductibles lower your premium (slightly) but increase the amount you must pay out of your own pocket if a loss occurs.
If you are a safe driver (childless, non drinker, few distractions, cord less cell phone, etc.) you may want higher deductibles.
If you have many distractions (kids) and drive many short trips, your exposure is higher to small fender benders where you would be subject to more of the deductible.
D) Should you get uninsured/underinsured motorist coverage?
This is a way easy one. Yes! If you don't have UM/UIM coverage and are hit by an uninsured motorist, your only option is to pursue the driver in civil court or small claims court.
