Industry specialists in the state of California are cautioning car owners against dropping coverage to save money. Legal experts also echoed the sentiment, saying that driving without insurance can lead to more expenses and legal troubles.
With the economy showing minimal signs of progress, economists say that the economic slump can affect how Americans, particularly Californians, spend their money. Already, some car owners and motorists have started dropping their insurance policies to cut back on expenses.
According to the Insurance Research Council, an estimated 18 percent of all vehicles in California do not have insurance. The figure makes the state the seventh worse in the U.S.
Driving without insurance can put motorists and their families at risk for more unwanted expenses, traffic experts say. Medical and repair costs can run into the thousands or even hundreds of thousands. Drivers without car insurance can also be held legally liable for an accident. This can mean hefty fines, penalties, and even potential jail time.
To prevent these situations from happening, insurance specialists recommend motorists to include additional coverage and options to protect them and their families further.
Car owners can choose to add Med Pay or personal injury protection to pay for any medical expenses regular insurance policies would not normally cover. While relatively inexpensive, this particular option is crucial for motorists looking for cheaper alternatives to full insurance coverage.
Industry specialists also recommend adding underinsured or uninsured driver coverage. With one out of every motorist in California uninsured, the possibility of getting in an accident with one is not that remote. Some policies even cover incidents where a policyholder is hit by an uninsured or unidentified motorist while walking, jogging, or even biking.
Experts suggest motorists to purchase policies with higher levels of coverage. California law allows motorists to get only the higher level of coverage if the two drivers involved in an accident have similar coverage.
Californians who feel they cannot afford insurance can qualify for law-mandated discounts. Insurance companies are obligated to offer low rates for drivers over the age of 19 with clean driving records. Low or medium-income policyholders earning up to 250 percent of the recognized poverty line can also qualify for discounts. Cars valued at less than $20,000 can also mean lower rates for drivers. These discounts are part of the California Low Cost Automobile Insurance Program.
Industry analysts predict that Californians will see more uninsured or underinsured drivers on the road if the economic recession continues. They advice getting good coverage to protect against potential accidents.