How much car insurance do I need?

Every state sets minimum auto insurance requirements, but state minimums rarely cover the true cost of a serious accident. The right amount of coverage depends on what you own, what you drive, and how much risk you're comfortable absorbing.

Start with state minimums

At a baseline, your policy must meet your state's required liability limits. These cover injuries and property damage you cause to others. Limits are written like 25/50/25 — meaning $25,000 per person, $50,000 per accident, and $25,000 for property damage.

Match liability to your net worth

If you have savings, a home, or future earnings to protect, raise liability well above state minimums. A common recommendation is 100/300/100, with an umbrella policy on top for higher net worth.

Consider comprehensive and collision

If your vehicle is financed or leased, your lender almost always requires both. If you own the car outright, weigh the replacement value against your annual premium and deductible.

Don't forget uninsured motorist coverage

Many drivers on the road are underinsured or uninsured. Uninsured/underinsured motorist coverage steps in when the at-fault driver can't pay — it's often inexpensive and well worth it.

Quick checklist

• Meet state minimums (required)
• Liability sized to your assets (recommended 100/300/100+)
• Comprehensive/collision if the car is financed or valuable
• Uninsured motorist coverage
• Optional add-ons: roadside, rental reimbursement, gap insurance