In every state except New Hampshire, auto insurance is mandatory. But how much coverage should you get? State-required minimums may not cover the costs of a serious accident. You may want to consider higher levels of coverage so you're not left financially exposed. You can customize your coverage to suit your needs and budget.
The first thing to understand is what your state requires. You can usually find state-specific requirements on your state's Department of Motor Vehicles website, but here's a general guide to what you're likely to need:
An auto policy covers you and other family members, whether you're driving your car or someone else's car. It also provides coverage for someone who is driving your car with your consent but is not on your policy.
Your personal auto policy covers personal driving — when you're commuting, running errands or vacationing — but not for using your car for commercial purposes like delivering pizzas or providing ride-sharing services. So if you do use your car for Uber or Lyft, be sure to talk to your insurance company about coverage for commercial use.
Finally, keep in mind that numerous factors influence your potential rates. These include the type of vehicle you drive, the miles you put on your car each year, how clean your driving record is, where you live, your age, your sex, the length of your credit history and your insurance history. Marital status factors in; married people often pay a lower premium amount. The coverages and deductibles you choose are the largest factors in cost. Also, rules will vary from state to state. Get a few quotes for comparison to figure out which coverage is right for your wallet. And be sure to ask what is — and is not — in the coverage you have.
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