How Much Car Insurance Should You Buy?

Don't spend hours trying to decipher your car insurance policy. If you're looking to purchase auto insurance, we've put together this quick and easy guide on how much coverage you need and the different types of policies. We'll even tell you about ways you can save money!

Please feel free to leave a comment or contact us with any questions; our friends at CarInsurance.com are always ready to help!

Car Insurance 101

What's the first thing most of us do when we get a raise at work? Buy that new TV? Put money in savings? Take a vacation? How about buy more car insurance coverage? The more than 20 million licensed drivers in North America spend over $22 billion a year on car insurance, according to a recent J.D. Power and Associates study.

Like anything else, car insurance is something you should understand before you buy it. If you're not quite sure what's in your policy or how much coverage it offers, you might be spending too much or getting less than you need. So, here's a quick and easy guide to answering some common questions about car insurance.

Enter your ZIP code below and get ready for some insurance education!

Q: How Much Car Insurance Do I Need?

The average national cost of one vehicle is more than $9,000, according to Edmunds.com. At that rate, the average driver needs at least $1,000 in annual insurance coverage to protect the vehicle from damage or theft.

Yet, about half of drivers carry less than $1,000 worth of coverage. In fact, one in five drivers have only the bare minimum required by law!

Tip: Although state laws differ, the following are the minimum liability requirements for car insurance:

$25,000 for injury or death of one person in an accident. This includes medical expenses. $50,000 for injury or death of two or more people in an accident. Also covers damage to property other than your car. $10,000 for any vehicle damage caused by a driver insured by your policy. Collision and comprehensive coverage help pay for repairs to your vehicle if you're in an accident with another driver (subject to the deductible amount).

Conclusion: You might be spending too much money on car insurance if you don't carry the basic coverages listed above. Consider buying more coverage:

Safety Features. You'll pay more for additional safety features in your car. For example, a radar-triggered alarm or other anti-theft device can add $300-$1,000 to your premium. Although most insurance companies recommend you carry collision and comprehensive coverage, one in five drivers only have liability insurance that covers property damage but not their vehicle. However, if you have a new vehicle with expensive safety features, we recommend getting collision and comprehensive coverage — particularly if you're a new driver or under 25 years old.