car inurance Q, opinions needed!

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iVillage Member
Registered: 03-25-2003
car inurance Q, opinions needed!
3
Tue, 03-07-2006 - 9:42am

Hi everyone! I just purchased my own insurance policy a few days ago, I have been on my father's insurance since I was 16 and we decided it was time to get my own. I found a good rate through a different company than my father and I purchased my own policy. I am having some trouble figuring out the coverage levels, but I feel pretty good about the coverage level I ended up purchasing. They are asking me to confirm my level of coverage through signing papers and such and I got to worrying about something.

Originally my coverage for first party medical benefits/income loss/funeral expenses was 5,000/0/0 on my father's insurance in order to save money on the monthly payment. When I purchased my policy, I decided to up the medical benefits from 5 thousand to 10 thousand with all other options remaining the same. I did this because I have no health insurance coverage to pick up the slack should I be hurt in an accident.

Now I'm wondering if 10,000 is a good number. I dont' have much money to spend so I felt good about upping it to that number because it still kept my payment low but gave me some more coverage. NOw I'm worrying, what if I get hurt, no medical coverage, hospital bills are so expensive, perhaps I should up my plan to 25,000 medical with a small amount of income reimbursement and funeral reimbursement. What about accidental death reimbursement?

My head is spinning from all the numbers. How much coverage would you recommend for a financially strapped young person with no health insurance? I appreciate any help you can offer me on this.

                          

             

iVillage Member
Registered: 01-25-2006
Tue, 03-07-2006 - 3:58pm

I was hoping someone with some more insurance experience would chime in. I'm always confused by all of this stuff too. Let's see...here's my best shot:

1. I would not purchase any accidental death coverage as a single woman w/o children. I also wouldn't do the funeral expenses or lost income. If you want to get a small life insurance policy to cover that for your loved ones, I would buy it separately and not tangle it up in your car insurance (would it cover if you were killed outside your vehicle?). As strapped as you are, I wouldn't spend the money. As far as the lost income, I can only imagine how horrible it would be to try and collect on that. Again, I would seek separate short term disability coverage but again, not sure I would spend the $ when things are as tight as they are for you.

2. The medical is another issue all around. I personally think the difference between $5k and $10k is pretty much a drop in the bucket but the $25k would take care of you in a fairly significant accident. I guess I come back to wondering if with that price difference, you could pick up a major medical/high deductible indiv. health policy that would offer you broader coverage for a comparable price. If you decide to do that, investigate the option of setting up a Health Savings Acct(HSA) w/your high deductible insurance to allow you some additional options for reducing taxes.

My first reaction would be to go ahead and duplicate the coverage you have been carrying and do some research on any of the above options until you figure out what might be the most economical. I think it is always best to insure what you can't afford to lose but until someone invents the money tree it'll always be a bit of a balancing act.

Peg

iVillage Member
Registered: 01-06-2006
Wed, 03-08-2006 - 8:31pm
OK so I looked at my policy again (I should know these things) and what I carry as a single woman with no house or other significant assest is $25/50K for bodily injury that's $25K person or $50K per incident. My father always kept much higher limits ($300K+) and deductables, and so did I when I was 16-20 living at home/college and still on his policy and his name was on my vehicles as a joint owner. He said he kept the higher limits because he could lose his home should one of his kids hit someone and he got sued. I have adjusted my deductables as I am more able to pay for losses myself. I have collision/comp coverage even though the car is paid off, but have adjusted deductables. When I was 21 and making $6-8/hr I had $0 deductable and paid higher premiums for more coverage, now I have a higher deductable. I may not have the e-fund yet to cover such a loss, but my income is much better and I could always find the money somewhere. I try and review my policy once a year and evaluate if it is working for me or would I feel better if I changed my coverages. I deal with a national company, but have a local agent. This works better for me than in the past having contact only through some 1-800#. My agent or his staff will answer questions anytime I call. He also helped me get the best price for my policy becuase he knew the area where I parked my car, the national companys just look at crime and other statistics for the zip code and you will pay more because you park in a driveway and not a garage around here.
Pam

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iVillage Member
Registered: 08-19-2003
Thu, 03-09-2006 - 7:45am

I just want to say that typically $25k-$50k, will probably only cover minor accidents. For a horrific accident your insurance will quickly run out. In this area that may just cover the airlift to a medical facility, forget about the treatment.

Shannon


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