Image via Flickr by sarahstierch
Car insurance is a requirement for all drivers to drive on the road in the U.S legally, and it’s one of the expenses you anticipate when it comes to owning a vehicle. You have some control over the amount you’re required to pay for car insurance by shopping around for several quotes from various automobile insurance companies. The difference between companies can be surprising, and finding cheap car insurance in Indianapolis may require that extra step.
What Are the Types of Automobile Insurance Coverage?
Having a basic understanding of the types of automobile insurance coverage as well as insurance limits will help you get the coverage you need at a price you can afford. There are four main types of car insurance coverage to consider when purchasing a policy: liability, uninsured/underinsured, comprehensive, and collision.
Liability insurance protects you and your assets when you’re involved in an accident when you’re the at-fault driver. Liability has two aspects, bodily injury and property damage, that are covered. Bodily injury liability covers medical expenses of the other driver and any other passengers involved, while the property damage coverage will cover the damage to any other vehicles or public or private property, such as a fence. Each state requires a bare minimum for liability coverage that all drivers must maintain.
Uninsured and underinsured motorist coverage will pay for medical expenses and even property damage in some instances. If you’re involved in an accident with an at-fault driver who lacks adequate insurance coverage, your insurance will step up to make the payments. You’re covered with the uninsured motorist insurance if the other driver has zero liability car insurance coverage, which is illegal in Indiana. Underinsured motorist coverage will cover the difference between the other driver’s coverage and the actual cost of your medical bills.
For example, suppose you have $32,000 in medical bills, and the at-fault driver only carries $25,000 per person in bodily injury liability. In that case, your insurance company will pay $7,000 towards your medical bills as long as it falls within your limits. Uninsured and underinsured coverage is optional in most states but required in a few.
Comprehensive coverage pays for damages to your vehicle caused by vandalism, theft, or natural causes such as hail. These are considered damages that are not your fault but still need to be paid by your insurance company. Comprehensive coverage is typically optional unless you have a lien or lease on your vehicle. The lending institution or lease company can require you to carry this coverage to protect their investment. With comprehensive coverage, you’ll also have a deductible that you’ve agreed to pay as your portion of the out-of-pocket expenses should you have to make a claim.
The amount of the deductible can affect your insurance premiums. The lower your deductible, the higher your premium, and vice versa. When selecting your deductible, consider whether or not you would have that amount to pay out-of-pocket should you need to utilize your insurance coverage. If the answer is no, you’ll want to select a deductible you can afford, even if that means a slight increase in your annual premium.
Collision coverage pays for damages to your vehicle or property when you’re the at-fault driver in an accident that involves another vehicle or object, such as a light pole. Collision is also optional unless required by your leasing agent or bank and also has a deductible component that affects the annual premium in much the same way as with comprehensive.
Additional types of insurance coverage include medical payments and personal injury protection. These lesser-known coverages are required by some states, optional in others, and not available in a few states. Talk to your insurance agent about these coverages to determine if they apply to you or would be prudent to add to your policy.
What Are the Minimum Automobile Insurance Requirements for Indianapolis?
Minimum automobile insurance requirements vary by state, and it’s imperative to know the minimum requirements of the state you register your vehicle in to stay within the law. The Indiana Bureau of Motor Vehicles has set the state minimum liability requirements as follows:
- Bodily injury liability of $25,000 per person and $50,000 per accident
- Property damage liability of $25,000 per accident
Keep in mind that these are minimum limits, and you can carry more to cover yourself in the event of a collision.
What Are the Penalties for Driving Without Adequate Insurance in Indianapolis?
The state of Indiana takes driving without adequate insurance coverage very seriously, and it’s evident in their penalties, starting with your first offense. Drivers need to be prepared to show proof of insurance, so be prepared to show your insurance card or face dire penalties, including:
- For a first offense: driver’s license suspended for 90 days to a year, $150 reinstatement fee, and requirement of SR-22 insurance coverage for three years after the incident.
- For a second offense within five years: suspension of driver’s license for one year, $225 reinstatement fee, reinstatement suspension of up to one year, and SR-22 insurance requirement for three years.
- For third and subsequent offenses: driver’s license suspended for one year, $300 reinstatement fee, reinstatement suspension of one year, and SR-22 insurance coverage required for three years.
SR-22 insurance is a statement of financial responsibility that proves you have adequate insurance coverage to drive in Indiana and significantly increases your annual car insurance premium.
Where Can you Find Cheap Car Insurance in Indianapolis?
Several factors determine your annual car insurance premium, such as your age, driving history, credit score, location, and type of vehicle. According to U.S. News & World Report, you can find cheap car insurance in Indianapolis through the following insurance companies:
- USAA: $580
- GEICO: $723
- State Farm: $830
- Progressive: $831
- Travelers: $1,064
- American Family Insurance: $1,206
- Indiana Farm Bureau: $1,281
- Nationwide: $1,303
- Farmers: $1,357
- Allstate: $1,503
The statewide average for minimum car insurance in Indiana is $1,068, and as you can see, some companies are both below and above that average. The difference between the lowest and highest is $1,000, cementing the fact that it’s essential to shop around for quotes from various companies before signing off on your policy.
You’ll also want to run quotes with higher limits, full coverage, and varying deductibles when getting quotes for cheap car insurance in Indianapolis. Minimum and full coverage can often be just a few dollars difference per month. When selecting your cheap car insurance in Indianapolis, take your time to get the most value for your money.
At FIXD, our mission is to make car ownership as simple, easy, and affordable as possible. Our research team utilizes the latest automotive data and insights to create tools and resources that help drivers get peace of mind and save money over the life of their car.