Saving a Few Bucks on Car Insurance Could Really Cost You and Your Family

Being in this line of work (helping people recover from serious personal injuries), we see our fair share of car wrecks. Bad wrecks. Wrecks caused by drunk drivers. Wrecks caused by people fleeing a crime scene. Wrecks caused by kids sneaking off with their parents' car. Wrecks caused by uninsured drivers.

Wrecks causing serious, debilitating, life-altering, life-taking injuries.

Unfortunately, the most careless among us tend to have the least to lose and are often grossly underinsured. Georgia law only requires that a driver have $25,000.00 in liability insurance. That's it. If you are seriously injured, that won't even cover an overnight visit to the hospital. Plus, there are more drivers on the road than you care to know that HAVE NO ACTIVE INSURANCE AT ALL.

How to protect yourself? First, don't settle for a cheap policy. And if you think you are saving some money, make sure to compare apples to apples. THERE IS NO ONE DEFINITION OF “FULL COVERAGE.” Full Coverage means something different depending on the agent/insurer selling you the policy. Make sure you understand specifics of what you are getting. Below outlines the basic coverages that most working Georgians need.

Liability - It's the law. You have to have at least $25,000.00 in coverage in case you cause a wreck that hurts someone else. But if you own a house, make a decent living, and/or have assets that total more than $25,000.00, you need more liability coverage. A LOT MORE. Consider at least $250,000.00 and if you have significant assets, get an Umbrella policy of $1,000,000.00 on top of that. It is less expensive than you think, and you will sleep much better at night.

Collision - Even if you are driving an old beat up Dodge, it makes sense to have collision. This way if you are in a wreck, your insurer will take care of the damage to your car, regardless of who is at fault. Fault is disputed (even in cases in which it is clear that the other party caused the wreck). Even when it is not disputed, it can take weeks sometimes months for the other insurer to complete their "investigation." In the meantime, you are without a car. Do not put yourself in that position. Pay the extra a month to have collision coverage.

Rental -- For the same reason that you need collision, unless you have an extra vehicle lying around, you need rental coverage so you can have access to transportation while yours is getting repaired and/or totaled out.

GAP Coverage -- If you have financed your car, this is a MUST. An insurer is only required to compensate you for the fair market value of your car immediately prior to the wreck. In many, many cases, this is LESS than what you owe on the car. Do not be put in the unenviable position of being in a wreck that you did not cause and owe $5,000.00 or more to your finance company.

Medical Payments (MedPay) -- Insurers and their agents do not do a good job of informing people about this coverage. Do not get into a car without it. Medical Payments (or MedPay) will pay medical bills you incur regardless of who is at fault for the wreck. Unlike health insurance, there is no deductible or copay with Georgia MedPay. Also, even though health insurance can and should be used to pay medical bills for injuries resulting from wrecks, health insurers like to tell you they do not have to pay, and are slow to pay the bills. Moreover, some providers will not bill Health Insurance if it is "auto related." Protect yourself and get MedPay. Most insurers offer up to $50,000.00 of MedPay. I would recommend having at least $10,000.00.

Uninsured / Underinsured Motorist Coverage (UM) - Get as much UM as you have in liability. (The law will not allow you to purchase more UM than you have liability). DO NOT ASSUME THAT YOU HAVE AS MUCH UM AS YOU HAVE IN LIABILITY. Check. It will only be a few dollars more a month. That way if you are injured by an uninsured or underinsured driver, you will be able to recover from your car insurer.

There are two types of UM. Add-on and Reduced-by or Set-Off. You want Add-on as your limits will be Added On to whatever insurance the other driver had. Otherwise, limits of the at-fault driver will be deducted from your UM limits, leaving you with less protection.

Hope this helps. Now that you have the basics, please take five minutes to check the Declarations Page of your automobile insurance policy (that contains a summary of the coverages that you have) and then call your agent or insurer and up your coverage!! You will sleep better for having done so.