If I have the money to set aside in a designated fund equal to the coverage that car insurance would cover, why do I need to waste money on car insurance?
If I have the money to set aside in a designated fund equal to the coverage that car insurance would cover, why do I need to waste money on car insurance?
byu/Necessary-Avocado-50 inInsurance
Posted by Necessary-Avocado-50
11 Comments
Simple answer, cause the law says so!
What will you do if you hit someone and it causes damage over that limit? Crashes can easily exceed state minimums then your assets may be at risk.
You have hundreds of thousands of dollars in a fund?
If it’s legal in your state/province/country, you don’t need to have car insurance. You generally deposit the money in a place designated by where you live though.
No reason other than liability coverage is required.
Unsure of what your car insurance looks like but from where I’m from there’s a Third Party Property Damage limit of 20-30mil.
If you’ve got that amount set aside in a different account, go for gold.
If not, this is the stupidest post I’ve seen…
Depends on the state. In California you need $75000 in bond or on deposit with the DMV
[https://www.dmv.ca.gov/portal/vehicle-registration/insurance-requirements/](https://www.dmv.ca.gov/portal/vehicle-registration/insurance-requirements/)
Almost every state has a legal requirement that you have auto insurance with minimum amounts of coverage specified. Only New Hampshire allows you to opt out if you can prove you have the financial responsibility to cover damage you might cause.
Perhaps the real question you should ask yourself is if you have the means to prove financial responsibility, aren’t those assets worth protecting? Nobody ever thinks they are going to get into an accident. But it happens. And even if you aren’t at fault, you’d be surprised what ambulance chasing lawyers can get away with.
It’s possible in Canada.
So multiple reasons.
Let’s say to follow the law, you put the amount required by law to forego liability insurance. What happens if you get into a disputed accident? You don’t have an insurance company to defend you. You’ll be on your own to get an attorney if you get sued. There is no arbitration for you.
For your own car, are you able to negotiate with shops? Do you have another car you can use while the damaged car is being repaired? Are you able to subrogate the other party to get the money back?
Your insurance will also cover if your car gets impounded after an accident. That’s a big headache you don’t have to deal with. If your car is a total due to massive damages, you don’t have to worry about selling it to salvage yards, etc. the insurance takes care of all of that.
Texas let’s you do that.