What Auto Insurance Coverage Do I Need?

This article is written by Peters and Associates.

When choosing auto insurance, many tend to choose the cheapest option that meets minimum legal requirements, but this is not always enough. Choosing the right insurance policy can be accomplished even on a budget.

If you’re shopping for a new policy, or if you haven’t evaluated your existing policy for a while, the start of the year is a good time to do so.

Follow this guide to find out what you’re covered for, what you should be covered for, and where you can cut costs.

Personal liability insurance

There are two types of liability insurance that you must purchase to legally drive.

Civil Liability Bodily Injury (BIL): Covers physical damage to people you injure when you are at fault in an accident. When insurance is listed as a series of numbers, the first two are your policy limits for BIL. “15/30/10” means that your insurance will cover injuries of a single person up to $ 15,000 or multiple persons up to $ 30,000 (no one receiving more than $ 15,000).

Civil liability for material damage: Covers repairs to the victim’s property (cars, fences, land, etc.). When shopping for insurance, this number is the third after your BIL limits. Using our example above, “10” means your insurance covers up to $ 10,000 in property damage that you cause, by accident.

What Liability Insurance Do You Really Need?

In Nevada, the minimum insurance is “15/30/10”, which can also be defined as $ 15,000 / $ 30,000 BIL + $ 10,000 civil liability for property damage.

Each state other than New Hampshire sets its own minimum amount of coverage required.

The general liability coverage recommendation for the middle income earner is 100/300/100, with 100/300 Uninsured / Underinsured Motorist Coverage (UM / UIM) to match (see next page for details). ‘explanation of UM / UIM).

While this number is high compared to the Nevada minimum, the cost of a higher level of insurance does not increase exponentially. If you are strapped for cash and / or drive infrequently, 50/100/50 (with 50/100 UM / UIM) should be considered the bare minimum.

According to the National Highway Traffic Safety Administration in 2010, the average “serious” accident resulted in an average of $ 48,620 in medical costs per injured victim. If you only have $ 15,000 of personal injury insurance, the injured party can sue you for the rest.

Remember that liability insurance does not cover you under any circumstances – your injuries, injuries to your passengers or damage to your vehicle.

If you opt for a liability plan that only covers 10/15/10, you could be held responsible for any charges in excess of the amount of coverage.

Other types of supplementary insurance

• Coverage for uninsured / underinsured motorists: This covers injuries to you or your passengers that are caused by an uninsured or underinsured driver, or a hit and run driver.

UM / UIM insurance is written like BIL (15/30, 50/100, 100/300, etc.) with two figures referring to per person / per accident.

Why you need it

According to the Insurance Research Council, 12-15% of Nevada drivers are uninsured and countless others have only Nevada 15/30/10 minimum liability insurance, making them underinsured in the vast majority of circumstances.

Because of this, there’s a good chance that if you’re hit by a driver in Nevada, they won’t have enough insurance to cover your medical bills if you’re injured.

For example, if you’re hit by a driver who only has Nevada Minimum Liability Insurance ($ 15,000) but the collision leaves you with $ 48,620 in medical bills, your own UM / UIM insurance may cover. the remaining $ 33,620 (if you have sufficient coverage).

Note: Most insurance companies limit your UM / UIM coverage so that it cannot exceed your personal liability insurance for bodily injury. This is to prevent people from paying for UM / UIM, which is much cheaper than BIL.

• Collision and overall: Collision insurance covers damage to your car in the event of an accident, even if you are at fault. Comprehensive insurance covers loss caused by theft or damage caused by anything other than an accident, such as falling objects, fires, windstorms, vandalism, etc.

Some insurance companies combine collision coverage with comprehensive coverage.

Why should you consider it

Collision coverage and / or comprehensive coverage comes in handy in certain circumstances, and is usually required by the bank if you are financing your car.

When pricing Collision / P&C insurance, the higher the deductible, the lower the cost of the insurance. But before you set a sky-high deductible, you need to consider whether you can afford to pay it if something does happen.

A $ 2,500 deductible is great if you never have an accident, but if you don’t have that kind of money and you get hit, you could end up without a car.

• Personal Injury Protection (PIP, also known as Medical Payment Insurance or MedPay): Covers lost medical costs and wages for you or your passengers, even if you are the driver at fault.

Why should you consider it

If you have personal health insurance, PIP / MedPay coverage may not be necessary as your health insurance will likely cover everything that PIP insurance will cover.

However, if you don’t have health insurance or have high maximum health insurance, PIP coverage can be invaluable.


If you have a question you would like to see a lawyer answered in a future issue, please write to questions@PandALawFirm.com or visit PandaLawFirm.com.

Please Note: The information in this column is for general purposes only and should not be construed as legal or professional advice of any kind. You should seek advice specific to your problem before taking or refraining from any action, and should not rely on the information in this column.

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Justin D. O'Neill