Why You Need Car Insurance

I can remember as a kid going out to the closest "fly-by-night" insurance company and getting the bare minimum insurance coverage that would make my car legal.  Heck, I didn't have much money but I had a car and I wanted to drive it - and did I.

For probably the first 4 years of my driving life I spent nearly 100% of my money on my car.  I had to make it sound better, run faster, jack it up, bigger tires, and on and on.  And this was on a Gremlin!  It was one of those weird, rare Gremlins that had a V8 sitting under the hood and for the first two gears (it was only a three speed) it was quite quick.  I, fortunately, decided my life was going no where and joined the Army before I could cause any damage on the road, and that was a very good thing.  Nearly thirty years later I look back and wonder how I ever made it out of my teen years.  There are lots of reasons for this bewilderment and the thing I want to focus on here is the fact that I was under-insured.

Insurance is bought to make sure you are covered for damages caused by an accident.  If you don't have insurance or are under-insured here is what happens in Florida.  Lets take the following scenario:

Driver A has a 10-20 policy ($10,000 per person/$20,000 per accident)
Driver A gets distracted for just a second and rear-ends Driver B
Driver B has a 100-250 policy and uninsured motorist protection
Driver B sustains injuries in the amount of $60,000.00
Driver B sues Driver A
Driver A's insurance tenders the max policy limit ($10,000.00)
Driver B's uninsured motorist coverage kicks in and covers the remaining $50,000.00

All seems well, right - but...

Driver B's insurance is not happy it had to cover the damages for an accident caused by Driver A so they sue Driver A for the difference in coverage ($50,000.00).
Driver A doesn't have that amount of money so Driver B's insurance gets a judgment against Driver A.
Driver B's insurance, having not been paid by Driver A, places a lien against Driver A's drivers license.
The Florida Department of Motor Vehicles suspends Driver A's license until the debt is paid.

There are a lot of people that find themselves in this very situation that call me hoping that there is something that can be done.  All I can tell them is to contact the attorneys that placed the lien and work out a payment plan and then follow it.

I cannot imagine, if I had been in this situation as a kid, where I would be today.  I know I would not be where I am. A financial burden such as this not only impacts your privilege to drive it also affects your credit.  It is a hole in which no one wants to start their adult life.

And so we reach the moral of the story. Being uninsured or under-insured is a huge risk.  Don't chance it.  Insurance coverage is cheaper than most people realize and everyone should consider higher policy limits.  If it is high because of prior bad driving behavior then time will have to be the cure (and a lighter foot).  Remember, automobiles are dangerous and can kill or maim others.  Drive defensively and follow the laws.

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