Am I carrying too much coverage on my auto policy?

Would I ever really need 250/500/100 coverage? The dealer signed me up for my current auto insurance policy and I am paying about $175 per month. I decided to shop for a lower rate and realized the limits he chose for me are extremely high compared to what most people carry.

Answer provided by
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Shannon Martin
Answered on Jun 24, 2021
Shannon is an expert in personal lines liability insurance with 13 + years of insurance industry experience. She also served as a special insurance liaison to AARP members for 6 of those years. She is a graduate of UL Lafayette and currently resides in NY with her family. Shannon is also an amateur juggler, ukulele player, and is a time travel paradox theory enthusiast.
“This is a great question! Yes, the limits you are currently carrying are higher than average. The recommended limits for most people are 100/300/50 because this is affordable and will cover you for most accidents. But it might not fully cover you for all accidents.
No one wants to think that they can cause a catastrophic accident, but it happens. The average cost for a new car is around $37,800. You currently are carrying $100k for property damage. If you cause an accident that totals two cars, you are most likely fully covered. If you have the average limit of $50k, you would have to pay around $25,000 out of pocket.
Property damage also covers things like:
  • stop signs
  • street lights
  • fences
  • houses
The cost of health care is always on the rise, so having more than the average bodily injury liability insurance coverage is a good idea as well.”
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