Every driver is required to have some form of auto insurance. Whether you own a car or not, you need insurance if you’re going to drive. However, handling insurance can be a little confusing and tricky. The state minimum protects other parties, but does not protect you. How you choose to boost your insurance policy and how you claim insurance in the case of an accident is completely up to your needs. In the end, the best decisions are what make you feel the most comfortable.
The State Minimum
Across the country, every state has a minimum required auto insurance law. Indiana has a Financial Responsibility Law which states that those liable for the damages and injuries must be able to pay for them.
By law, there is a minimum amount of auto insurance coverage that every driver with a registered vehicle must have. This is typically referred to as “liability” insurance. To meet the requirements, insurance policies must at least cover:
- $25,000 per injured person
- $50,000 per accident
- $10,000 of property damage
It’s against the law to drive any motorized vehicle (that requires vehicle registration) without insurance. Those who are caught operating a vehicle without the minimum required liability insurance will have their license suspended for 90 days and a reinstatement fee will be applied. For first offenses, the fee is $150; for the second, it’s $225; for the third, $300. If any driver is caught twice within a one-year period, they will have their license suspended for an entire year.
In some cases, like a DUI charge, the BMV will require you to present documentation of your auto insurance policy. The SR-22 (“SR” stands for “safety responsibility”) acts as proof that someone does have at least the minimum required auto coverage. The insurance company will file this directly with the BMV.
Taking the Extra Coverage
The minimum ensures the safety and coverage for others, but what about you? Auto insurance policies range in price. The more coverage, the higher the monthly premium. Each insurance policy is different, with areas to pick and choose the amount of coverage received. For instance, you may choose to pay more for personal protection and less for liability coverage. Often, drivers will stick with a minimum liability and start to increase the premium for personal protection. The more you get, the better.
Claiming Insurance in the Case of An Accident
Accidents happen, and they can’t always be prevented. If you are the sole party involved in an auto accident, and your car receives damages, you have options. Insurance companies will require you to get an estimate on how much the damage will cost to fix. They will then offer you that amount for the repairs. Here’s where your options come in:
- Option 1: You get the repairs done and your insurance company covers the bill, often for the amount they specify. Having more coverage can increase the chances of you paying nothing out of pocket for repairs.
- Option 2: You can opt out of getting the repairs and pocket the coverage amount specified by your insurance company. Some people choose this option when the damages are purely aesthetic and don’t hinder the car’s performance. The drawback to this option is that once you decide not to have the repairs done, you are opting out of future coverage for that specific area of your car.