Cost is important when shopping for car insurance. But while it’s certainly a good idea to shop around for the best deal, that is not the only thing to consider. Here are some points to think about:
- The legally mandated minimum only covers liability in Michigan. This means that all costs that are going to affect you are not going to be covered. Liability will help to ensure that, if you are found to be at fault, the other party's ends are covered. Beyond that, you'll be on your own getting your car repaired or replaced and getting to work while your car is in the shop — unless the other party's insurance winds up paying for everything.
- Additional provisions are not as expensive as you might think, and certainly cheaper than the alternative. Gap insurance, for example, might only cost you a few extra dollars a month. But it may save you thousands by covering the difference between what you've paid on your car loan and what you have left to pay. A good policy may be worth hundreds of thousands of dollars. And its premiums might only cost you a fraction of its value over the years.
- The odds of being involved in a car accident at least once in your lifetime are extraordinary. Forbes suggests that you should expect to file a claim about once every 18 years. No matter how safe a driver you may be, there will be conditions you couldn't have possibly predicted, or be drivers you didn't see coming. Car insurance may be a "just in case." But that "just in case" is almost inevitable on the road.
Consider your ends, your needs and your means, and buy yourself a level of protection that you are comfortable with. The minimum required amount of insurance protects other drivers from you, but it doesn’t necessarily protect you fully.