If you have a car, you need to insure it. It’s for this reason that auto insurance is one of the most common types of coverage – but that doesn’t mean the average person knows much about it. In fact, there are a lot of common misconceptions about auto insurance. Make sure you’ve got your facts straight to ensure you secure the car insurance you need to protect your vehicle, your assets, and yourself.
Misconception One: Meeting Your State’s Requirements Is Enough
States establish minimum insurance requirements for vehicles. In Hawaii, drivers are required to maintain:
- $10,000 per person in personal injury protection coverage
- $20,000 per person and $40,000 per accident in bodily injury liability
- $10,000 per occurrence in property damage liability
However, these are just the minimum requirements. Not only can you obtain more insurance, it’s often a smart idea to do so. This may include additional types of coverage. If you’ve taken out a loan for your car, your lender will almost certainly require you to carry collision and comprehensive insurance, which covers damage to your vehicle. It is also wise to carry uninsured and underinsured motorist coverage.
You may also want higher limits. For example, Hawaii only requires $10,000 in property damage liability coverage. If you total someone’s car, you may be on the hook for a lot more. By securing higher limits, you’ll protect your assets from lawsuits.
Misconception Two: A Short Gap in Coverage Is No Big Deal
When money’s tight, you may be tempted to let your auto insurance coverage lapse for a while. After all, you haven’t been in a crash in a long time. What are the odds you’ll get into one in the next week or two?
This is a bad idea for two reasons.
First, no matter how safe a driver you are, there’s a risk you’ll be involved in a crash. If you don’t have coverage, you could be personally liable for the costs.
Second, insurance is a legal requirement. Even if you’re not in a crash, letting your insurance lapse may lead to major financial and legal problems. In Hawaii, if you don’t have insurance for your vehicle, you must surrender the registration certificates and license plates, which means you can’t drive the vehicle anymore. If you keep driving, you may face pricey tickets, license suspension, and community service. It is also likely to be harder and more expensive for you to buy car insurance in the future.
Misconception Three: Your Auto Insurance Will Cover the Items in Your Car
Imagine you accidentally leave your phone in your car. A thief sees it, breaks into your car, and steals the phone. You assume your car insurance company will cover it – but when you report the claim, your insurance company tells you that your policy doesn’t cover personal items.
If your car is broken into, you can file a claim with your auto insurance company to gain compensation for any damage to the vehicle. As long as you have collision and comprehensive insurance, your policy should provide coverage. Likewise, collision and comprehensive insurance will cover you if your vehicle is stolen. However, you won’t have coverage for personal items (such as phones, laptops, or clothes) stolen from your vehicle.
The good news is renters and homeowners insurance policies typically do cover theft of personal items from your vehicle.
Misconception Four: You Can’t Be Sued for Injuries in Hawaii
Hawaii is a no-fault state. This means that, if you’re in a crash, your personal injury protection coverage will cover any injuries you and passengers suffer, whereas the other driver’s personal injury protection will cover injuries that this driver and his or her passengers suffer. No lawsuits are necessary; however, they are still possible. When injuries are serious and medical expenses are high, it’s possible to sue the at-fault driver.
Do you have more questions about auto insurance? An agent will clear up any other misconceptions and help you find coverage. Find an agent.