Confused by All the Auto Insurance Options and What You Need?

Young woman pulls her hair out of confusion and frustration

If you’re confused by all the auto insurance options out there and what you actually need to be legally insured in Nevada, you’re not alone. In many cases, consumers are often bombarded with more information than necessary and, most of the time, minimal coverage is all you need.

When purchasing auto insurance, you’re faced with an endless flow of choices as to limit amounts, whether your car is worth the expense of collision and comprehensive coverage or if supplemental insurance, also known as an umbrella policy, makes sense. Rather than risking the chance of confusing you further from the outset, let’s begin with the minimum insurance requirements for the state of Nevada – in case you’re new to shopping for auto insurance and are just unfamiliar with them.

Bodily injury and property damage liability are mandatory by Nevada law. Minimum coverage limits are as follows:
• Up to $30,000 covers personal injury of all persons in the car at the time of the accident
• A limit of $15,000 for any one individual
• Up to $10,000 for property damage

While minimum insurance coverage may satisfy what the law requires, it’s also important to note that it may not provide the full degree of protection you could possibly need in the event you’re involved in a serious automobile accident, resulting in critical bodily injury.

So, let’s break down the basics of various auto insurance options available to you beyond the minimal requirements.

• Liability Insurance
As a matter of law, you’re required to have this coverage. It covers property damage, along with medical expenses from personal injuries sustained by others in case you’re at fault in an accident. The property damage coverage pays for the repairs or replacement of the other party’s vehicle and/or damage to fences, etc.
• Collision Insurance
This covers any damage to your vehicle, once the deductible obligation has been met. In a case where the vehicle is deemed a total loss, unless your policy entitles you to full replacement value, your insurance company will hand you a check for the actual cash value, which means your insurer will account for age, depreciation, wear and tear, and mileage to determine the value of the vehicle.

Needless to say, you could be stuck with owing a lender the difference between the balance owed and what you received. Even worse, if the vehicle was paid for…what your insurance company gives you could make it a financial hardship should you be forced to purchase another vehicle. Because collision insurance can be quite expensive, determine if your car is worth the added expense. If not, save your money.
• Comprehensive Coverage
Comprehensive insurance covers losses from such events as natural disasters, fire, theft, and vandalism. As with collision coverage, a deductible is usually in effect. Again, it’s unlikely these policies will pay out more than the actual cash value or Kelley Blue Book value – should the vehicle be stolen, destroyed by fire, or totaled by another natural occurrence. Bottom line here is – if you drive an older vehicle of minimal value…comprehensive coverage could be a waste of your hard-earned money.
• Personal Injury Protection and Medical Coverage
Designed to reimburse or pay any medical expenses you or a passenger may suffer in an accident, this type of policy usually does so without regard to fault. Since it follows you, it carries over to any vehicle you might be driving when injured.

The policy may also cover you or a family member should you sustain any injuries as pedestrians if hit by a car. In case the injuries are extensive and your limits are reached, your health insurance may likely kick in to cover the excess until litigation, should you choose to pursue it, can recover some of the costs.
• Uninsured/Underinsured Motorist Coverage
This provides additional coverage if you’re involved in an auto accident with an uninsured motorist or one who carries the state minimum requirement of auto insurance. Should you sustain catastrophic injuries, uninsured/underinsured coverage can continue your care if you exhaust the policy limits of the driver at-fault.
• Personal Umbrella Policy
Umbrella policies are designed to cover you in the event of a lawsuit from an auto accident. It can protect you from losing your personal assets, such as your home, savings, wages, vacation homes, investments and rental property. The limits can range between $1,000,000 and $5,000,000, depending on the insurer. Rule of thumb is – your limit of liability should be greater than the total amount of your assets. But, be aware that not all insurance companies offer this type of policy.

Just remember – when shopping for auto insurance, cover all your bases and compare your needs with what makes sense…and, you can’t go wrong.

It also makes sense to check that you’re getting the best rate on your current auto insurance. Why not get a free auto insurance quote today?

Do you carry full coverage or the Nevada state minimum insurance requirements? Feel free to share your thoughts in the comments section below.