When it comes to purchasing auto insurance, many New York drivers settle for the state minimum requirements. Often drivers look no further than finding the least expensive coverage. While this might seem like a cost-effective approach, it can lead to significant financial risks and hardships in the event of an accident.
Understanding State Minimum Insurance
New York State law mandates that drivers carry at least the following auto insurance coverage:
- $25,000 for bodily injury per person $50,000 per accident [liability protection for injury to others] There is also a matching minimum for uninsured / underinsured motorist coverage;
- $50,000 for No-Fault Benefits / Personal Injury Protection (PIP) per person (driver, passengers, and pedestrians) injured [for medical/health expenses, lost earnings, and certain other expenses];
- $10,000 for property damage per accident [for damage caused to property of others];
While these minimums may meet the legal requirements, they often fall short in providing adequate protection in real-world scenarios. In this article we discuss why opting for higher coverage can make a significant difference.
Don’t Get Fooled By The Phrase “Full Coverage.”
Often potential clients come to our offices thinking that because their insurance agent told them they have “full coverage” that means they have sufficient coverage. This may not be so. “Full coverage” simply means, in addition to the liability and No-Fault, coverage, you also have collision coverage [for damage to your car from a collision] and comprehensive coverage [for damage to your car from non-collision events, such as theft, vandalism, fire, weather, etc.]. This “full coverage” is often required by a lender, while payments are being made. “Full coverage” doesn’t protect you as much as it protects the lender. Alone, it certainly does not increase the amount of protection that you have if you are injured.
For the reasons we discuss below, we at The Eskesen Law Firm suggest that drivers opt for higher-than-minimum limits for bodily injury and uninsured / underinsured motorist claims at the very least.
Protecting Yourself From Liability Claims
To be sure, a primary benefit of purchasing higher insurance is to help protect you in the event you are found to be at fault for an accident that caused injuries to another. The damages and medical expenses resulting from even a relatively minor accident can quickly exceed the minimum coverage limits. This can leave you personally responsible for the remaining costs, which can be financially devastating. Higher liability coverage ensures that more of these expenses are covered by your insurance, protecting your assets. And in general, we believe it is a good and proper thing to have adequate coverage for the harm that you might cause to others.
The Importance Of Uninsured And Underinsured Motorist Coverage
Beyond this notion of being responsible towards others, there is a more self-interested reason we recommend purchasing more than the New York State minimum. When you buy higher liability coverage to protect others, you also can add that higher limit to your uninsured and underinsured motorist coverage. This helps protect you when someone injures you and they do not have insurance, or they do not have enough insurance to adequately compensate for the injuries they cause.
Let us examine a real-world scenario. A driver comes into a law office. They were a seat-belted operator of a car that was stopped at a red light, which was hit in the rear by an inattentive, speeding motorist. As a result of this crash, the victim was violently thrown backwards and forward in their seat, sustaining neck injuries that result in partial paralysis of their right arm and required multiple surgeries to attempt to correct. The offending driver was a 21-year-old, newly minted driver, who only has the state minimum insurance and no other assets. Even though the victim’s injuries far exceed the amount of available insurance of the at-fault driver, the most they can collect from that insurance company is that $25,000 state minimum. If the client/victim, too, only has the state minimum, they are out of luck. However, if the client/victim followed the recommendations here, and purchased more than the minimum insurance, they would be able to pursue the difference between what they purchased and that of the offending driver, from their own insurance company.
Peace of Mind: Knowing that you have higher uninsured and underinsured motorist coverage provides peace of mind. You can drive confidently, knowing that you, your family, and your passengers are protected regardless of other drivers’ insurance status.
The Cost Of Higher Coverage Vs. State Minimum
A common misconception is that higher coverage is significantly more expensive than the state minimum. However, in many cases, the additional cost is relatively modest compared to the benefits it provides. For instance, increasing your liability limits from the state minimum to higher levels often results in only a small increase in your monthly premium.
While specific data on the cost difference between state minimum and higher coverage can vary by insurer and individual circumstances, it’s generally observed that the majority of the insurance cost is concentrated in the basic state minimum. Upgrading to a higher coverage level might only raise your premium by a small percentage, while increasing your protection many times over. This small increase can help protect you and your family in the event of serious injuries that are caused by someone with the state minimum coverage.
While sticking to the state minimum insurance requirements might seem like a way to save money, it can lead to greater financial risks. By opting for higher coverage limits and making sure you include increased uninsured and underinsured motorist coverage, you are safeguarding yourself, your passengers, and your assets with minimal increased expense. Do not settle for state minimum limits. When shopping for insurance, do not simply opt for the cheapest coverage. Instead, decide which higher-than-minimum coverage limit best suits you, be it $100,000/$300,000, $250,000/$500,000, or some other amount, then feel free to shop around for the cheapest company that will provide that coverage to you.
If you need assistance after a car accident, contact our experienced car accident lawyers in New York City, NY, for a free consultation.
