The easy answer to this question is you need to carry the minimum car insurance required by your state. In fact, many states check for proof of insurance if you are pulled over by law enforcement. If you cannot provide proof of insurance, you may receive a ticket and will have to bring proof of insurance during your court appearance.

Each state specifies a minimum amount of auto insurance coverage; you can inquire about through your state insurance office or through your local insurance company. These minimums are typically designed to cover damages in what the state may deem an average accident. Unfortunately, many accidents don’t fall within the cost of the state’s average. The Insurance Information Institute recommends that driver’s carry $100,000 in bodily injury protection or general liability per person and $300,000 per accident. Remember, these are the maximum reimbursement levels, and costs that exceed these figures will be the responsibility of the driver.

There is a long list of insurance coverage types:

• Bodily Coverage
• Collision Coverage
• Property Damage
• Comprehensive Coverage
• Personal Injury Coverage
• Insured/Uninsured Coverage
• Rental Reimbursement Coverage
• Towing Coverage

The minimum for some of these coverage types is set by each state. However, many of these coverage types are set based on a driver’s individual needs and the environment wherein you operate your vehicle.

You should consult with an insurance agent for details on what each type of coverage can provide. A brief description of each is provided below:

Bodily Coverage: covers injury claims by the other party for medical expenses if you are found to be at fault.

Collision Coverage: covers the cost of car repairs or the replacement of your vehicle if you are at fault. Otherwise, it is your responsibility.

Property Damage: covers damage to other vehicles, structures and miscellaneous items if you are found to be at fault. Otherwise, it is your responsibility.

Comprehensive Coverage: covers damage to your car if no other car is involved. (i.e. hitting an animal or building).

Personal Injury Coverage: covers certain medical expenses or lost wages, regardless of fault.

Insured/Uninsured Coverage: covers the cost of an accident with underinsured or uninsured motorist.

Rental Reimbursement Coverage: covers the cost of rentals after an accident.

Towing Coverage: covers towing costs after an accident.