Factors influencing auto insurance rates

Insurance companies and industry groups are saying the recall of more than 8 million Toyota cars and trucks shouldn't have an impact on insurance rates. The price of auto insurance is determined by many factors, and isn't limited to just the model you drive, the cost to fix it and its overall safety record.
The Insurance Information Institute, a trade group for the insurance industry, said the average driver pays about $850 a year in insurance. Your bill can be influenced by several factors:
DRIVING RECORD
The more accidents and serious traffic violations you have, the more you'll pay. You may also pay more if you haven't been insured for a number of years.
MILES DRIVEN
The more miles you drive, the more chance for accidents, the more you'll pay. If you drive less than 10,000 miles a year, you will pay less. Some companies will give discounts to policyholders who carpool.
WHERE YOU LIVE
Insurance companies look at local trends, such as the number of accidents, car thefts and lawsuits, as well as the cost of medical care and car repair.
DRIVER'S AGE
Mature drivers generally have fewer accidents than less experienced drivers, particularly teenagers. So insurers usually charge more if teenagers or young people below age 25 drive your car.
THE MODEL
Cars that cost more, have high theft rates, cost more to repair or have poor safety records cost more to insure.
DRIVER'S CREDIT
Some insurance companies use credit scores as a factor in insurance rates. Credit-based insurance scores are based on information like payment history, bankruptcies, collections, outstanding debt and length of credit history. Regular, on-time credit card and mortgage payments affect a score positively, while late payments affect a score negatively.
AMOUNT OF COVERAGE
The larger your policy, the more you'll pay. However, you may qualify for discounts. Some insurance companies offer discounts if you have your homeowners and auto insurance policies with them, for example.

States with Highest Car Insurance Prices

For most drivers, the all-time most resented vehicle expense is not gas, oil changes or even those triple-digit transmission repairs, but auto insurance.

Every six months to a year, drivers voluntarily or, in some states are required to, play Premium Poker: the high-stakes game in which you bet your driving fortunes against the car insurance companies, all of which have better hands than you do.

Even in these days of almost universal nationwide mandatory coverage, about 15 percent of motorists drive uninsured, according to Insurance Research Council estimates. "The problem of uninsured motorists persists," said Elizabeth A. Sprinkel, IRC senior vice resident. "Responsible drivers who purchase insurance end up paying for injuries caused by uninsured drivers."

Other unofficial estimates of uninsured drivers, which include illegal aliens, the underage, elderly, medically unfit and disqualified individuals who are driving, put the total at a much higher level than the quoted 15 percent. An even more frightening recent GMAC study found that one in six licensed drivers currently on the road are unfit to drive. It is estimated that 600,000 drivers in New Jersey alone are hitting the roads without car insurance. However, they (the car insurance agencies) know that sooner or later the odds catch up with nearly everyone, and your chances of making it through your driving years without a major automotive incident are outstandingly rare. Last year there were there were 5,930,182 police-reported motor vehicle traffic crashes, according to the National Association of Insurance Commissioners, resulting in an average of one fatality every 12 minutes (every 31 minutes in alcohol-related crashes), an injury every 12 seconds, and 4,181,000 cases of property damage.

Even more sobering, is the U.S. Department of Transportation's estimate that an additional 10,000,000 crashes go unreported, many because the drivers have no car insurance and just as many because the drivers are trying to avoid a possible increase in their car insurance prices due to the accident.

So what makes up the cost of your car insurance prices? There are four basic standards:

•Who you are: age, occupation, marital status, geographic location, medical condition.
•What you drive: SUV, sports car, minivan, luxury sedan, high performance model, truck.
•How you drive: tickets, DUIs, accidents, high mileage.
•Where you drive: high crime and crowded urban areas, suburban town, rural and wide open spaces.

There are multiple other factors punched into the cost calculator: is your vehicle financed so the cost can be recovered if totaled; what safety equipment does it have (side impact airbags and curtain airbags are much better); driver education courses taken; history of illnesses which could affect driving safety and that occupational information which shows some drivers (like professors and engineers have) as a sub-culture with much better driving records than, let's say, young, blonde celebrities and aging movie stars.

There can also be a credit check and another verification to see if you are one of the 36 million licensed Americans who have been judged unfit to drive in a study by GMAC, the 2007 Insurance National Drivers Test. That probe found that one in six current drivers could not pass a written DMV exam if taken today. The worst odds of running into one, or perhaps one of them running into you, are on the East Coast, while your chances of fewer encounters would be among the best-educated drivers in Idaho and Oregon.

With all of those factors stacked against your chances of continuing to drive without incident or accident, there are things you can do to lower your car insurance prices, like not driving drunk and giving up street-model NASCARs. Then again, there are those you can't control, like where you drive.

Of course if you decide to move in order to lower auto insurance costs, here are some actual numbers to juggle:

The national average annual outlay for liability coverage alone was projected to be $847 for 2007, according to the Insurance Information Institute. The estimate was based on combined stats of the institute and the National Association of Insurance Commissioners, an organization which assists state regulators. It does not include collision or comprehensive coverage.

Car insurance figures like those can be misleading. For example, consider the highway robbery for drivers in major urban areas. According to Insurance.com, drivers in Detroit, Philadelphia, Newark, New York and Los Angeles were paying, from $5,984 to $3,303 a year, in that order as of February 2006, for $100/300/50* liability, $500 deductible each for collision and comprehensive and $100/300* for uninsured. These multi-thousand-dollar car insurance prices are due, to higher density of traffic, increased likelihood of theft or vandalism and greater incidence of fraudulent claims, according to insurers.

The good news about auto insurance costs is that despite the increasing costs of medical care and vehicle repair plus cumulative weather-related damage such as the Katrina disaster, car insurance experts have anticipated a drop in rates. The Insurance Information Institute forecast a drop of 0.5 percent in 2007, once again, for liability coverage alone. That would be the first decrease since 1999.

Making state-by state comparisons is trickier, however, as the official Insurance Information Institute premium charts are only as recent as 2004; the highest car insurance price for that year was $1,221.08 in New Jersey, the lowest, $579.95 in Iowa.

Below are the most up-to-date state figures from the Mid-Year Auto Insurance Pricing Report by Insurance.com. It's based on car insurance quotes given to consumers by participating auto insurance companies in the 47 states where Insurance.com operates, plus the aggregate profile of consumers who shop using their Web site.

The cost of getting caught driving without auto insurance can vary from state to state, depending on the percentage of drivers who are uninsured in that state. In Massachusetts, residents can be charged anywhere from $500 to $5,000 in fines and receive a one-year jail sentence. In Florida, Louisiana, Connecticut and New Jersey, drivers operating a vehicle without the state required minimum will have their vehicles impounded, which can cost thousands depending on how long it takes to recover the vehicle.

Finally, even though there remain two states –New Hampshire and Wisconsin -- which do not require motorists to carry liability insurance, all 50 have some auto insurance requirement about. In many states, motorists can't register a car without showing proof of liability insurance. In others, they don't ask for proof of car insurance until drivers have accidents or tickets on their records.

3 Things to Consider When Buying Cheap Full Coverage Auto Insurance

If you’re looking for cheap full coverage auto insurance you’ve got to be a bit confused about all the choices you have. And, because most people want to get quality coverage along with money savings, it can take a bit of time to consider different aspects before deciding upon which company to go with and which policy to buy.

Understanding what the terms mean will speed up the process.

Full Coverage Insurance - Full coverage insurance is comprehensive coverage that covers you personally for every type of insurance that your insurance company offers.

Here are some examples:

Medical Costs

Medical costs could be an option for some policies. When you have a full coverage auto insurance policy the medical costs of everybody in your car are covered if you get into an accident and sustain injuries.

Liability

Liability is also covered when you have a full coverage auto insurance policy. So if an accident is your fault, this coverage makes it possible for all the damages you’ve caused to be compensated.

Liability coverage should be part of everyone’s insurance policy because you never know who will be blamed if there’s an accident. In this case it’s far better to be safe than sorry.

The Cost of the Premium

It pays to compare premium costs with different insurance carriers if you’re looking for cheap full coverage auto insurance because the cost of identical coverage can vary by hundreds of dollars or more per year.

The premium will be based on your age, your gender, and how old your vehicle is.

By the way, if your car is on its last legs you may not want to invest in full coverage because the premiums will be higher. You could end up paying premiums based on the current market value of the car. It usually makes more sense to get cheap full coverage auto insurance policies
for newer vehicles.

Some comprehensive insurance polices cover you in case of arson or vandalism, but they aren’t very common.

When comparing premiums you can check out companies online and get in touch with some insurance agents who can keep you abreast of information about cheap automobile insurance.

Car Insurance Coverage Details and More

Buying a car insurance policy means you need to become familiar
with the details of each type of coverage. Do you know what you
want in terms of coverage? Or do you need to consider more
details before you move forward? The fact of the matter is that
there are many details that surround the car insurance industry,
available policies, and you as a consumer. For this reason you
need to know as much as you can about the car insurance
industry, as well as what you are looking for.

What coverage details are most important to you? This is among
the most important questions that you will face. For instance,
you may feel that a low deductible is as important as it gets.
In this case you will need to search for a car insurance policy
that offers many options in this area. This will allow you to
see what is available and how much it costs.

Of course, you don’t want to get hung up on one coverage detail.
Remember, it is important to consider anything and everything
that has to do with a policy; especially if you are ready to
make a buying decision. Skipping over one detail may be a huge
mistake.

The details you face as a car insurance consumer will determine
what you end up with and how much you pay. Remember that every
detail, big and small, is important to your future. Once you
realize that this is the case you should be able to begin your
search for car insurance. Are you ready to buy a policy? Once
you know all about car insurance coverage details your answer
should be a resounding yes.

Insurance anyone?

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Auto Insurance

Answer: This is insurance which protects the insured against losses involving the use of automobiles. Various coverages may be bought depending on the desires of the insured. Such coverages include the liability coverages of bodily injury, property damage, and medical payments, and the physical damage coverages of collision and comprehensive.

Read On......

N.J. Commissioner: State Regulation Helped Insurance Withstand Sagging Economy

New Jersey Banking and Insurance Commissioner Steven Goldman thinks the shaky economy's impact on insurers has been softened in part by state regulation. Sworn in to office by Gov. Jon Corzine in March 2006, Goldman is the chairman of the National Association of Insurance Commissioners' International Insurance Relations Committee and Reinsurance Task Force. Here is some of what Goldman had to say to BestWeek:

State Regulation

If you look at the financial sector over the entire spectrum, the one that has withstood the current economic crisis the best is the insurance sector. That's not by accident. The regulatory structure for the insurance sector has been more effective than the regulatory structure of the other sectors.

Federal Role

The most important part of a federal approach would be in the context of the discussion taking place about a systemic risk regulator. It is difficult for states, either singularly or in the aggregate, to develop programs which would enable the use of systemic risk regulation, which by definition, needs to be across all sectors of the financial services industry. A systemic risk regulator should include representatives from all segments -- including state regulators who regulate the insurance industry.

New Jersey Coastal Insurance

There is affordability and there is availability. We've had a number of new entrants come to the market; we have had surplus lines carriers in the market. It has become somewhat more expensive but we don't think it's become unaffordable and it's definitely available.





Insurers' Adjusting to Auto Reform

Happily, with respect to [the sunset of take-all-comers and caps on urban territories], unhappily with respect to the TREE [Territorial Rating Equilization Exchange] program we put in place. There are a number of carriers who I think understand the purpose. All carriers have been cooperative in working through the process. [The removal of old regulations] coupled with TREE enabled us to remove them without having disproportionate rates follow. We think it's been a highly competitive market.

TREE Progress

Quite good. It is industry board represented; continues to innovate for ways to make it work as smoothly as possible.

PIP Fee Schedule Stuck in Court

We've been trying hard to move that along. We're at the mercy of the court schedule, but we do want to see it implemented. To the extent rates are being driven somewhat higher, that is a principal cause. It would be a great help to New Jersey consumers and to the industry to get a comprehensive schedule in place.

Professional Liability Challenges

It has turned to a softer market the last year or so, so there has been less of an outcry as a result. We've proposed regulations, which would enable us to take a tighter look at the insurance treaties that some of the medical malpractice carriers have entered into so we can be certain there has been appropriate risk transfer. Principally what we are after there is to make sure that the audit committee reports directly to us when we come in about the nature on investments and return on investments. We are also going to propose some ability on the part of the department to review and approve rate increases and decreases.

Auto Insurance Questions - Answers to Important Auto Insurance Questions

Auto insurance is something everyone needs, but not everyone understands. This is not surprising considering that the average auto insurance policy is several pages long and is written in legalese. Unfortunately most of us are not lawyers so legalese needs to be translated for us to understand it. On the bright side, coverage is not as complicated as the dense wording in the policy would make it seem.

Auto insurance is one of the most heavily regulated industries in the country and this is a good thing for the typical consumer. Most states spell out exactly how much coverage you need and every state, excepting New Hampshire, requires your vehicle to be insured.

The state recommendations are a good guideline for the type of car insurance policy you should consider, but remember the state recommendations are for the minimum amount of protection required. It is usually a good idea to purchase more than the minimum amount.

If you are in a higher tax bracket you should definitely have more than the minimum amount for protection. You should also carry more coverage if you have other assets. Basically you want your auto insurance to shield you from any repercussions that may result from an auto accident that you are involved in.

The good news is that increasing your auto insurance coverage does not usually cost much more money. In some cases you can buy fifty thousand more dollars worth of coverage for just a few dollars per month.

The best way to find an affordable policy that meets your financial needs it to search for a policy online. This will allow you to compare costs and benefits of policies side by side. The other benefit to shopping for vehicle insurance online is that it takes very little time.

Remember that the auto insurance company is working hard to earn your business. Any company worth doing business with will have an automobile insurance agent who can answer any other auto insurance questions you may have.

Auto Insurance

Answer: This is insurance which protects the insured against losses involving the use of automobiles. Various coverages may be bought depending on the desires of the insured. Such coverages include the liability coverages of bodily injury, property damage, and medical payments, and the physical damage coverages of collision and comprehensive.

Read On......

Auto Insurance Primer Advice

What is auto insurance? Auto insurance (or car insurance, motor insurance) is insurance consumers can purchase for cars, trucks, and other vehicles. Its primary use is to provide protection against losses incurred. By buying auto insurance, depending on the type of coverage purchased, the consumer may be protected against:

* The cost of repairing the vehicle following an accident

* The cost of purchasing a new vehicle if it is stolen or damaged beyond economic repair

* Legal liability claims against the driver or owner of the vehicle following the vehicle causing damage or injury to a third party.

Liability insurance covers only the last point, while comprehensive insurance covers all three. Even comprehensive insurance, however, doesn’t fully cover the risk associated with buying a new car. Due to the sharp decline in value immediately following purchase, there is generally a period in which the remaining car payments exceed the compensation the insurer will pay for a “totaled” (destroyed, or written-off) vehicle. So-called GAP insurance was established in the early 1980’s to provide protection to consumers based upon buying and market trends. The escalating price of cars, extended term auto loans, and the increasing popularity of leasing gave birth to GAP protection. GAP waivers provide protection for consumers when a “gap” exists between the actual value of their vehicle and the amount of money owed to the bank or leasing company. In some countries including New Zealand and Australia market structures mean that people are more likely to buy a nearly new car than a new car so this is less of a problem.

In the United States, liability insurance covers claims against the policy holder and generally, any other operator of the insured’s vehicle, provided they do not live at the same address as the policy holder and are not specifically excluded on the policy. In the case of those living at the same address, they must specifically be covered on the policy. Thus it is necessary for example, when a family member comes of driving age they must be added on to the policy. Liability insurance generally does not protect the policy holder if they operate any vehicles other than their own. When you drive a vehicle owned by another party, you are covered under that party’s policy. Non-owners policies may be offered that would cover an insured on any vehicle they drive. This coverage is available only to those who do not own their own vehicle.

Generally, liability coverage does extend when you rent a car. However, in most cases only liability applies. Any additional coverage, such as comprehensive policies, i.e. “full coverage” may not apply. Full coverage premiums are based on, among other factors, the value of the insured’s vehicle. This coverage may not apply to rental cars because the insurance company does not want to assume responsibility for a claim greater than the value of the insured’s vehicle, assuming that a rental car may be worth more than the insured’s vehicle. Some states, such as Minnesota, may require that it extend to rental cars. Most rental car companies offer insurance to cover damage to the rental vehicle. In some regions, the costs associated with not having access to the vehicle (”Loss of Use”) is also covered.

Auto Insurance

Is Your Auto Insurance Company Rated?

Several national rating institutions rate insurance companies. Do coverages, rates, and service vary from company to company? Why can you pay less with one company than another can for the same coverages? find the solution now.....

auto insurance

Is Your Auto Insurance Company Rated?

Several national rating institutions rate insurance companies. Do coverages, rates, and service vary from company to company? Why can you pay less with one company than another can for the same coverages? find the solution now.....

Many Texans lacking auto insurance

AUSTIN — One in four drivers stopped by state troopers in Austin and Travis County for traffic violations this summer has been uninsured, and the percentage may be even higher in other parts of the state, an insurance industry spokesman said Monday.

"The numbers show that Texas has an even larger number of uninsured drivers than we had realized," said Mark Hanna, spokesman for the Insurance Council of Texas, which has been monitoring Texas' new auto insurance verification program.

"Troopers tell us that some areas of the state may have more than half of their drivers uninsured, and that's scary news for everyone else on our roadways," he added.

Texas law requires every driver to carry liability insurance, and the minimum amount required was increased this spring for the first time in 22 years.

Hanna said he didn't think the higher requirement was a factor in the lack of coverage because the effect on premiums was "minimal."

But 25.5 percent of 5,012 drivers stopped by Texas Department of Public Safety officers in Travis County and small portions of nearby Williamson and Hays counties since June 2 have lacked insurance, he said.

DPS spokeswoman Tela Mange said the number of insured drivers has "always been a moving target."

"We always thought it was somewhere between 20 and 25 percent," she said, based on information provided by drivers in accidents. But this is the first verification program of its kind in Texas.

Travis County was selected for a 60-day pilot project testing the new TexasSure program, which allows police via computer to verify coverage status when they stop a motorist.

A $7 million contract with HDI solutions Inc., an Alabama company that developed the database of insurance customers and drivers' license records, is funded by a portion of the vehicle registration fee.

All uninsured drivers stopped by troopers during this testing phase, which will end in a few more days, have been ticketed. Drivers who said they were insured but weren't carrying proof of insurance weren't issued citations if troopers, using the new technology, validated their insurance coverage.

"The program has worked the way it was supposed to," said DPS Lt. Louis Sanchez.

After the pilot project has been completed, DPS will issue an evaluation report. Eventually, the program is designed to be available for use by police statewide, although it won't be mandatory.

The new minimum requirements for auto liability insurance in Texas are $25,000 of coverage for each injured person, up to a total of $50,000 per accident, and $25,000 for property damage.

The previous minimum requirements were $20,000/$40,000/$15,000.

The new requirements were expected to increase the cost of liability coverage by 4 percent to 6 percent, although liability insurance is only part of the auto coverage for many drivers.

Someone driving without liability insurance can be fined as much as $350 for a first offense and as much as $1,000 for subsequent offenses.

auto insurance

Is Your Auto Insurance Company Rated?

Several national rating institutions rate insurance companies. Do coverages, rates, and service vary from company to company? Why can you pay less with one company than another can for the same coverages? find the solution now.....

Auto insurance

Auto insurance Auto insurance

Auto Insurance

Is Your Auto Insurance Company Rated?

Several national rating institutions rate insurance companies. Do coverages, rates, and service vary from company to company? Why can you pay less with one company than another can for the same coverages? find the solution now.....

Auto Insurance

Is Your Auto Insurance Company Rated?

Several national rating institutions rate insurance companies. Do coverages, rates, and service vary from company to company? Why can you pay less with one company than another can for the same coverages? find the solution now.....

Inside Insurance: Changes coming to uninsured motorist auto coverage

By David Colmans

Most drivers fear, with good reason, a traffic crash with an uninsured or underinsured driver.

If it happens, there’s a good chance it’s going to cost you money unless you have uninsured/underinsured motorist coverage on your auto policy.

Even if you have the coverage and the other driver is underinsured, a serious accident that does significant damage to your car or badly injures you or your passengers could cause serious financial problems ahead.

With the recent enactment of Georgia Senate Bill 276, there is important information regarding an additional choice in UM/UIM coverage that you need to know.

The new law, which applies to private passenger auto insurance, requires that you either select or reject UM/UIM coverage with a new feature.

Currently, the law states that when you purchase UM/UIM coverage and are in an accident with an underinsured driver, the at-fault driver’s liability coverage is deducted from your UM/UIM coverage when determining the amount to be paid after the accident for injuries and property damage.

Starting with policy renewals in 2009, another coverage option will be available:

• (The new option) UM/ UIM coverage in which the policyholder’s UM/UIM coverage is added on top of the at-fault driver’s liability insurance, to the extent of proven damages, or;

• (current law) UM/UIM coverage in which the at-fault driver’s liability coverage is subtracted from the policyholder’s UM/UIM coverage, or,

• (also current law) No UM/UIM coverage is purchased.

Here’s how you will choose which option is best for you. If you currently have UM/UIM coverage and take no action prior to your next policy renewal, you will receive, and pay for, the additional UM/UIM coverage, also known as “stacked” coverage. Because this option will provide additional coverage, it is likely to cost more than your current UM/UIM coverage.

If you do not want the enhanced UM/UIM coverage, you must opt-out of it using a form that will be sent to you by your insurance agent or company.

If you have already rejected UM/UIM coverage, in writing, and you take no action you will continue to have no UM/UIM coverage.

Georgia insured motorists will receive from their insurer at least 45 days prior to their policy renewal notification of this change in Georgia law, and will be asked to make a choice as to what coverage choice they want.

The new law that goes into effect in 2009 states that if you currently have UM/UIM coverage, and you do not respond to your insurer, you will automatically receive the enhanced coverage that may include a higher UM/UIM premium.

If you opt-out for the enhanced coverage, you will continue to be insured for UM/UIM as before. Selecting the additional UM/UIM coverage option may be important to some drivers, and less important to others. The key is that the new law gives motorists another choice when determining the right amount of coverage for themselves and their families.

Look for your 2009 auto insurance policy renewal notice that will advise you about this potential change in your coverage. Ask your agent or company if you have questions.

Auto Insurance For Anyone Considering A Change

A question often asked is whether or not securing your car will help to reduce your UK car insurance premiums.
Most insurance companies will allow consumers seeking to insure their classic car the opportunity to drive their vehicle around 5000 miles a year.
If you have more than one car to insure on the same policy then you can definitely get cheaper car insurance by availing the multiple-car discount option that many companies offer.
New Jersey car owners are required to have bodily injury and property damage liability, as well as personal injury protection (which can cover medical, rehabilitation, and funeral costs, as well as any lost earnings due to the accident
Now, in both cases if the two vehicles in the accident were carrying uninsured/underinsured motorist coverage, their insurance company would take care of the excess bodily injury, and property damage costs not covered by your policy.
Again, if you are carrying the same coverage�s as listed above, 4 of the 6 people would be covered by your state minimum policy because everybody was under the $20,000 per person limit, but you maxed out your per accident bodily injury at $40,000, so you would need to take care of $20,000 of bodily injury on your own
4 of the 5 people would be covered by your state minimum policy because everybody was under the $20,000 per person limit, but you maxed out your per accident bodily injury at $40,000, so you would need to take care of the 5th person on your own.
Did you know that in order to drive legally in most states, drivers are required to purchase a minimum of liability insurance, including property damage and bodily injury? Car insurance is required in all states, to one extent or another, but drivers are still free to choose to what extent they cover their personal property and health.
A simple Internet search will lead you in the right direction if you�re looking for companies that will give you online car insurance quotes.
Buying car insurance online saves time and money�you just fill in your details, get a quote, do a comparison between quotes from different providers, choose the most beneficial one, fill the application, save it, pay the premium and in some states even print out the insurance card yourself.
If you are a first time buyer, or you have a limited budget for your car, you should carefully investigate the different insurance policies available, as some might suit you better financially.
Being caught at the scene of an accident or at any sort of traffic stop without proof of car insurance has been cause for an expensive ticket for several years.
One of the simplest ways to realizing affordable car insurance is by paying a higher deductible.
Sure, we can not stop our children from eventually driving, but we can find ways to get cheap car insurance for our driving teenagers.
Young people who want to renew their car insurance policy might have to pay more if they have been recently involved in any accident or a serious traffic violation like drunk driving.

Auto Insurance 101

What Is Auto Insurance?
An auto insurance policy is a contract between you and an insurance company. You pay a premium. In exchange, the insurance company promises to pay for specific car-related financial losses, within the selected coverage limits, that you may have during the term of the agreement.

Most states require that you carry automobile liability insurance in certain minimum amounts. If you are at fault in an accident the law requires that you pay the damages sustained by the person who is not at fault. These can include property damage, which is the cost to repair or replace any property that you have damaged. These can also include damages for personal injuries, which include not only the other person's medical expenses and lost wages but also damages for pain and suffering, permanent injury, and loss of enjoyment of life. These damages can come to thousands of dollars even for a minor accident. That's why adequate insurance is essential to your economic health.