There are three main reasons why you might need auto insurance:
• If you own a car, you need auto insurance to protect yourself and others involved in an accident that is your fault or that is caused by an uninsured or underinsured driver. The costs of a single accident could bankrupt you. if you had to try to pay them out of your own pocket. Even relatively minor losses could be financially challenging, and some losses could leave you without transportation if you could not afford to replace or repair the car.
Having car insurance helps you protect your assets and use your money to achieve other important financial goals.
• Nearly every state (49) requires that vehicle owners carry some amount of insurance. Not maintaining at least the minimum required amount of insurance is against the law and could result in various penalties.
• If you are making lease or loan payments on your vehicle, the lender will require you to carry insurance so that if the car were to become damaged or totaled, the lender wouldn’t lose the collateral for the loan. Not maintaining coverage on a leased or financed vehicle could result in repossession.
