I just bought my first home and my parents told me that I need to look into increasing my car insurance coverage. What does car insurance have to do with owning a home and how much coverage do I need?
Mar 7, 2016Kansas City, MO
Mar 7, 2016
There is no specific requirement as to what level of coverage a homeowner must carry on their auto insurance, however, the point of liability coverage is to pay for injury and damage that you might cause in an accident. Your home is your largest asset and you should be aware of the importance of protecting that asset against civil lawsuits arising from exceeding the amount of coverage on your auto insurance policy due to an accident. Should the injuries and/or property damage you cause in an accident exceed your limit of liability you could potentially lose your home and other assets in a lawsuit. To help mitigate as much risk as possible, most companies will recommend that a homeowner carry liability limits of at least $100K bodily injury per person/$300K bodily injury per accident/$50K property damage on their auto policy. You may consider even these amounts to be insufficient so many companies will offer limits above these recommended amounts as well as umbrella policies to add even more coverage for your situation.