Start with Your State’s Minimum Requirements
Every U.S. state (except New Hampshire) mandates some form of minimum auto insurance. These often include:
- Bodily injury liability (e.g., $25,000 per person / $50,000 per accident)
- Property damage liability (e.g., $25,000) These are bare minimums and often not enough in serious accidents.
Consider Full Coverage if Your Car Has Value
If your vehicle is leased, financed, or relatively new, you may need:
- Collision coverage – Covers damage to your car in a crash.
- Comprehensive coverage – Covers theft, vandalism, fire, or weather-related damage.
Add-On Coverage to Consider
- Uninsured/Underinsured Motorist (UM/UIM): Protects you if the other driver lacks insurance.
- Medical Payments (MedPay) or Personal Injury Protection (PIP): Helps pay medical bills regardless of fault.
- Gap Insurance: Great for new cars, it covers the difference between your loan and the car’s value if totaled.
So, What’s the Right Amount?
If you own a home or have significant assets, higher liability limits are a must. Most experts recommend at least:
- $100,000/$300,000 for bodily injury liability
- $100,000 for property damage
A good rule: Buy as much liability coverage as you can reasonably afford. It protects you more than any other part of your policy.
Conclusion
Choosing the right amount of car insurance coverage in 2025 isn’t just about meeting legal requirements—it’s about protecting your financial future. While minimum coverage might be cheaper upfront, it can leave you vulnerable to expensive claims. Evaluate your car’s value, your assets, and your budget, and aim for the highest liability limits you can afford. In the long run, a well-structured policy can save you far more than it costs.