How Much Auto Insurance Do You Need?

Bodily Injury Liability
Property Damage Liability
Personal Injury Protection
Uninsured Motorist Protection
Collision and Comprehensive
Extras

ONE TRIED AND true way to reduce your auto insurance premium is to hike the deductible on your collision coverage and skimp on your liability coverage. Sometimes this can make sense, but often it's not worth the extra risk. In this section we'll explain several of the coverages you're likely to be offered as you shop for insurance (some are mandatory). Then we'll help you figure out how much to carry of each type.

Bodily Injury Liability This coverage, which is required in most states, compensates the driver of the other car and its passengers in the event you get into an accident. It also covers the passengers in your car. The main consideration here is protecting your assets against lawsuits that arise from auto accidents. "But I'm a careful driver," you say. It doesn't matter. You can get sued even if the accident is not your fault.