If you have an auto insurance policy, pull out the declarations page that lists what is covered, and you’ll see some or all of these common coverages:
Liability: Liability coverage protects you in case you cause a wreck and injure someone or damage their property. On your policy, you will see this broken down into bodily injury and property damage.
In Georgia, you are required to have 25/50/25 liability coverage. This means your insurance company would cover damages up to $25,000 per person and up to $50,000 per incident for bodily injury and $25,000 for property damage. Based on most cases I see, 100/300/100 liability coverage usually is sufficient. However, keep in mind that you could be personally responsible for damages beyond your policy limits.
Medical Payments: This covers your medical bills, regardless of whether the wreck was your fault. The limits we see on this type of coverage generally are much lower than your liability coverage, typically ranging from $1,000 to $5,000. Some insurers offer higher amounts, which might be appropriate if you don’t have health insurance.
Umbrella Policy: This is a separate policy you can purchase, in addition to your primary one, to provide an additional layer of coverage for anything beyond the policy’s limits. Individuals with a high net worth or a significant amount of assets seriously should consider purchasing umbrella coverage.
Uninsured Motorist (UM): This protects you in a situation where the at-fault driver doesn’t have enough coverage to compensate you fairly for your damages.
I highly recommend having UM coverage to match your liability coverage, and make it “add-on,” as opposed to “reduced-by.” Add-on coverage means your UM coverage is added to the at-fault driver’s policy limits to cover your bodily injuries or property damage. For example, if you have add-on UM coverage of $100,000, and the at-fault driver has $25,000 minimum limits coverage, you will have $125,000 available to cover your damages. If you select reduced-by coverage, you will have only $75,000 available from your policy because your UM coverage would be reduced by what is available from the at-fault driver’s policy.
Saving Money: Avoid insurance brand loyalty. If you stick with the same company for decades, you’ll end up paying more for the same coverage you could get from another carrier. Get quotes for the same coverage from multiple carriers, and go with the lowest cost option.
– Joel Williams is a partner at Williams|Elleby, a Kennesaw-based personal injury law firm. www.gatrialattorney.com.