What Is the Cheapest Minimum Coverage Auto Insurance?
Every state requires that its drivers carry some form of auto insurance that will cover them in case of a crash. However, each state has different requirements for the minimum amount of coverage that drivers must carry. The amount of coverage a driver is required to carry will affect the price of the policy, as will a number of other factors.
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State Laws
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According to CarInsuranceRates.com, each state requires drivers to carry three different types of liability insurance: bodily injury insurance for one person; bodily injury insurance for two or more people; and property damage liability coverage. For example, drivers with vehicles registered in Georgia must purchase a policy wiith $25,000 worth of injury liability for one person, $50,000 for injuries to multiple parties and $25,000 for property damage.
Cheapest State
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Mississippi has the lowest car insurance minimums in the nation, with drivers required to hold $10,000 of single-party injury, $20,000 of multiple-party injury and $5,000 of property damage liability. By contrast, Alaska and Maine are the most expensive, with drivers required to hold $25,000 of single-party injury, $50,000 of multiple-party injury and $25000 in property damage. However, a state having the lowest minimums for coverage does not necessarily mean that its drivers are paying the cheapest rates.
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Features
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The price of an auto insurance policy hinges on many factors, including the driver's age and driving record, the price and safety features of the car being insured and the area in which the car is being driven. An insurance company will generally price its policies according to the expected amount of losses that a certain driver in a certain car will incur. Formulas for calculating specific rates vary between companies.
Considerations
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Drivers who are considered at least risk of suffering an accident generally pay the lowest car insurance rates. For example, an experienced driver with a safe car who drives in an area in which few accidents occur would pay considerably less than a relatively new driver with a history of accidents driving an unsafe car in an area in which accidents occur frequently.
Misconceptions
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Although a driver searching for an auto insurance policy can shop around for policies, he must confine his search to the state in which the car for which he is seeking insurance is registered. For example, a person driving a car registered in California cannot buy a policy from an agent based in Florida. However, drivers do not have to worry about getting into an accident in another state and having coverage insufficient to meet state minimums. According to Insure.com, all car insurance policies automatically adjust to meet state minimums when the car is driven across state lines.
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