focus on your health and of those you care.
According to information from the Insurance Research Council, one out of eight drivers don’t have auto insurance. This is an eye-opening statistic when you consider how many people are driving on today’s crowded streets. If you have an accident with someone without auto insurance, you may have to pay any medical expenses and repair costs out-of-pocket.
Suppose you don’t have uninsured motorist coverage and you or your passengers are injured. In that case, you have the option of taking legal action against the other party and suing for damages, but there are no guarantees you will win. Uninsured motorist coverage keeps you from paying out-of-pocket, so you can focus on your health and the health of those you care for the most when involved in an accident. It also keeps you from having to use your health insurance.
What Is Uninsured Motorist Coverage?
Most states require this type of auto insurance coverage, but coverage requirements vary. In Illinois, all drivers must be covered by liability insurance to help defray costs associated with damages or injuries sustained in a crash. Property damage liability insurance does not cover damages to your own vehicle, as that coverage is already built into your collision and comprehensive auto insurance policies.
Without property damage liability coverage, even a fender bender could result in a huge financial loss. More than that, since liability insurance is required in Illinois, driving without it can cause you to lose your driving privileges.
Liability insurance options are typically offered in two varieties:
- Combined single limit policies provide a certain amount of coverage, and the policyholder can decide how to divide that coverage between property damage and bodily injury. A combined single limit policy states a single dollar amount of coverage, which you can then apply to any combination of claims.
- With a split limit policy, your insurance company decides how much coverage to include for property damage and bodily injury. For instance, you might see your policy written in shorthand as: 25/50/20. In this example, the first two figures apply to bodily injury coverage or death of one or multiple people involved in an accident, and Illinois sets those minimums at $25,000 and $50,000, respectively. The final figure, $20,000, goes toward repairing someone else's property damage you caused in an accident.
In a scenario where you caused minor damage, such as swerving to avoid an animal and hitting a neighbor's mailbox, your policy should completely cover the damages. When another vehicle is involved, however, major damage typically occurs. Let's say you hydroplane and hit two vehicles, causing $25,000 in damage. Given the above example, your policy would pay up to $20,000 toward damages, but you're responsible for the remaining $5,000 out of pocket.
When another motorist is injured in an accident and requires hospitalization, the bodily injury liability part of your coverage takes over. After exhausting the bodily injury limit, however, you're left with the remainder of the hospital bills.
Having more property damage liability coverage is better than not having enough. The more coverage you have, the more likely your policy will completely cover damages. Even so, more coverage means paying a higher insurance premium, which isn't always affordable.
Most states that require motorists to carry bodily injury and property damage liability insurance set minimum amounts. In Illinois, the minimum coverage limit per accident is $15,000. Keep in mind, however, that liability coverage is only one aspect of any required auto insurance policy. You'll still need to meet the state's minimum coverage requirements across the board. Fortunately, your insurance company will provide you with options that meet or exceed the legal requirements.
If you have trouble obtaining insurance through an insurance company, ask an agent about the Illinois Automobile Insurance Plan. This state-monitored program is for drivers who otherwise have difficulty getting coverage.
Now that you know the minimum coverage amounts required by Illinois law, you're probably wondering how much you should actually purchase. While states have their own minimum requirements, those figures are relatively low when you consider how much property damage you can cause in an accident.
As of May 2019, the average price of a new car came in at $36,718, which was up over $1,000 just from the year before. If you only have $20,000 in property damage liability coverage, and you cause an accident that totals a new car valued at $30,000, you'll have to come up with the remaining $10,000. If you can't afford to pay that bill out of pocket, the affected party can sue you for the difference, putting your assets and savings at risk. You may even run the risk of losing your home or business.
With new car and property costs skyrocketing, your safest bet is to purchase the maximum amount of property damage coverage you can afford. At least $100,000 per person, $300,000 per accident, and $50,000 of property damage liability coverage is a solid choice.
The costs associated with property damage liability coverage depend on numerous factors, including your driving history and the state you live in. Which insurance company you buy your liability coverage from will also affect the cost.
Using an online auto insurance calculator or comparing free quotes can help give you a better idea of how much you'll need to set aside for your insurance policy. Let's just say that you have a clean driving history and a decent liability-only policy ends up costing about $550 per year. Combined with a comprehensive and collision policy, your annual cost rises to about $1,060. If you only want to meet the state minimum requirement, you might be looking at around $425 liability only, or $940 comprehensive.
With a recent speeding ticket or accident, however, these costs will go up. Insurance costs are also affected by your age and your car's make and model.
Overall, regardless of how much a comprehensive auto insurance policy costs, you should have enough coverage to protect you, your family, and your assets in the event that you cause a costly accident.
Ensure you're covered in any scenario with adequate property damage liability coverage protection. Contact your local Illinois agent at American Auto Insurance to get started.
Have Additional Questions?
American Auto Insurance can help.