Most of us just pay our automobile insurance premium without completely understanding what coverage we have and what coverage we should have. In this and the upcoming series of blogs we want to give you a brief explanation of the various options you have and recommendations for coverage.
Personal Injury & Insurance
Liability insurance is required by state law and in North Carolina the minimum limit is $30,000 for personal injuries per person with $60,000 of maximum coverage per accident. There is also a maximum payout of $25,000 for property damage.
There are almost no circumstances where you should be satisfied with minimum limits. If you cause an accident where the injuries or damage is greater than your limits, you may be personally liable for any amount above your limits. You could potentially lose your savings, your home or may even have to file bankruptcy. Most of the cost of an automobile insurance premium is in the minimum coverage and increases in coverage are generally not as expensive as you buy more and more coverage.
How much coverage to buy is a matter of your willingness to pay a higher premium to minimize the risk to your personal assets. At a minimum we recommend $100,000 in liability coverage, but $300,000 would be preferred.
Your policy might read like this, 100/300/50. This means you have $100,000 coverage for any person injured in a crash you cause; $300,000 of maximum coverage per accident – regardless of the number of persons injured; and $50,000 per accident of property damage coverage.
The North Carolina Department of Insurance has an excellent brochure explaining the types of coverage. For more information on this topic, please go to:
North Carolina Automobile Insurance Coverages.
Please feel free to share this blog with your friends and family on this often misunderstood area of the law.
On the next blog, we’ll discuss more information you need to know about your liability exposure in an automobile accident.