Massachusetts requires anyone registering a vehicle to get a minimum amount of insurance before issuing license plates. That’s why if you are stopped by the police and your insurance has canceled, the first call the police officer makes is to the tow truck company: you have to have insurance.
Why So Much?
So when you consider that all you need to drive legally is “insurance”, why pay more than the minimum? The answer lies in another question: what happens if you have an accident?
Massachusetts required coverage for one part, known as “Damage to Others’ property”, is $5,000. Suppose you are in an accident, and are at fault. (For more on fault, click ‘standards of fault’). Assume further that your accident is with a newer car, worth $20,000. Because you were at fault, they’ll come to you to be reimbursed. If you have minimum limits, your insurance will pay $5,000. But the other driver or their insurance company has a legal claim on you for the $15,000 balance.
Is it Worth it?
How much did you save by getting minimum limits? In Norwell, the difference between $5,000 and $25,000 is about $25 per year for an experienced driver. It’s another $5 to go to $100,000 for this coverage, because claims in the higher amounts are less common.
What About the People
Another coverage that we believe the state’s minimum limits don’t provide adequate protection is Bodily Injury. This is the coverage that pays for people who are hurt in an accident; the state required amount is $20,000 per person, $40,000 per accident (for other people in the other car). This coverage is also limited to Massachusetts public roads, meaning it won’t follow you on private roads, such as a mall parking lot, or out of state.
What To Do About Bodily Injury
To get broader coverage, buy “optional bodily injury”. And consider higher limits. The most common coverage is $100,000 per person and $300,000 per accident. It costs a lot more to repair people than it does to repair cars.
Learn more about your auto insurance options here.