Despite how much people are already paying for coverage, it might not be enough if the worst happens.
Inflation, among several other factors, has caused auto insurance premiums to climb, this year in particular, but according to experts, millions of drivers still don’t have enough coverage.
Despite how much millions of people are paying for their policies, they don’t have the coverage they need.
Car insurers have been raising premiums because the cost of paying out claims is higher due to inflation. That said, when it comes to drivers, they might be paying more, but they aren’t receiving any additional coverage. Depending on the policy they already have, that can be problematic, said Bankrate insurance writer and editor Cate Deventer.
“Rising costs mean that your coverage may not go as far as it used to,” said Deventer. “Several million people might be underinsured.”
Experts are recommending that auto insurance customers review what their policies cover.
Policyholders should take the opportunity to understand how their policies work and what is – and is not covered. The language of a policy might not make this obvious to everyone, but it is perfectly within a policyholder’s right to contact an agent to have the specifics explained.
“People buy a policy and pay the bill every month without checking what they actually have,” said Deventer. This is always problematic, but at a time when people are watching their premiums increase, it’s even more important not to mistakenly feel as though the coverage is also rising.
The first thing a policyholder should know is whether they have comprehensive and/or collision coverage, as these cover different types of expense in the incident of a collision. It’s important to think about issues ranging from the cost of damage to the vehicle itself to the vehicle’s theft, but also damage to another person’s vehicle or property, or the expenses associated with medical bills if someone – the policyholder, a passenger, or someone outside the vehicle – is injured.
According to Deventer, liability coverage is the most important factor to consider. This is especially true when you’re buying auto insurance in a state that doesn’t have no-fault protection in place. If a driver is found to be at fault, they could be held responsible for expenses from property damage and damage to other vehicles, but also medical expenses for the other drivers, their passengers, or any bystanders injured in a crash.