Should I Purchase More Vehicle Insurance Than South Carolina Requires?

Owning a vehicle can be costly, and many drivers choose to purchase the cheapest car insurance coverage. However, like most things in life, you get what you pay for when it comes to auto insurance. In this post, we will discuss how car insurance works and why it is beneficial to purchase a policy with higher limits. 

How Does Car Insurance Work in South Carolina?

Car insurance is a financial safeguard that provides protection against monetary losses incurred due to accidents, theft, or other unforeseen circumstances involving a vehicle. The basic idea behind car insurance is that you pay a monthly or semi-annual fee, called a premium, in exchange for the insurance company’s promise to cover certain accident-related expenses. There are several choices when it comes to vehicle insurance coverage, and knowing how each type protects you can come in handy in the event of an injury accident. 

Liability Insurance

In South Carolina, liability insurance is mandatory coverage for bodily injuries and property damage after an accident. Whether you are at fault or injured in an accident, this coverage can help cover medical expenses, repair costs, and potential legal fees. For example, if you were hurt in an accident caused by a distracted driver, the at-fault driver’s liability coverage would provide you with compensation for your injury-related expenses. For South Carolina, the minimum liability coverage includes $25,000 for bodily injury, $50,000 total bodily injury for each accident, and $25,000 for damages to property in each accident. 

Collision Coverage

Collision insurance covers damages to your vehicle resulting from a collision with another vehicle or a stationary object, irrespective of who is at fault. It helps to repair or replace your car, helping to ensure you are not financially burdened by accidents. For example, if you experience a tire blow-out and crash into a tree, collision coverage would kick in to pay for the damage to your vehicle. 

Comprehensive Coverage

This covers damage caused by events other than collisions, such as natural disasters, theft, vandalism, or contact with animals. For example, if you hit a deer while driving at night or your vehicle is damaged due to a flood, you’d call on your comprehensive coverage. 

Personal Injury Protection (PIP) / MedPay

Often known as “no-fault” insurance, PIP covers medical expenses and, sometimes, lost wages or other damages, irrespective of who caused the accident. In South Carolina, PIP coverage isn’t available; however, insurance companies offer a similar product called MedPay.

MedPay is similar to PIP in that it covers your medical expenses in the event of an accident, regardless of which driver was at fault. The only difference between PIP and MedPay is that MedPay strictly covers explicit medical and funeral costs, whereas PIP covers a bit more. MedPay typically covers between $1,000 and $5,000, depending on your policy selection. 

Uninsured Motorist Coverage

This coverage protects you in an accident with a driver without insurance. It can cover medical expenses and property damage when the at-fault driver has no insurance. For example, if you are struck by a hit-and-run driver who is never identified, your uninsured motorist coverage would likely cover your accident-related expenses. Unlike some states, South Carolina law requires you to purchase uninsured motorist coverage to drive legally.

Underinsured Motorist Coverage

Underinsured motorist coverage (UIM) is an optional component of a South Carolina car insurance policy that protects you in an accident with a driver who doesn’t have enough insurance to cover the full extent of damages. Essentially, UIM steps in to cover the difference between the other driver’s policy limits and the damages you sustained up to the limit of your UIM coverage. This type of coverage is especially important in South Carolina, where it is estimated that over 10 percent of drivers don’t have car insurance or don’t have enough coverage. By purchasing underinsured motorist protection, you can have peace of mind knowing you are safeguarded from the potentially devastating financial impact of a motor vehicle accident. 

Umbrella Insurance

Umbrella insurance is an additional insurance policy that provides additional liability protection beyond the limits of standard insurance policies, such as homeowners or auto insurance. Designed to kick in when your primary insurance coverage is exhausted, umbrella insurance safeguards your assets from large claims or lawsuits. That being the case, this type of coverage is particularly important for individuals with significant assets. Most insurance companies offer umbrella policies starting at $1 million in coverage. 

The Benefits of Buying an Insurance Policy with Higher Limits

There are several benefits to having a robust insurance policy that provides coverage in excess of the state minimums. Below are a few reasons why having a higher-limit insurance policy makes good financial sense. If you cause an accident and the other party’s medical expenses are significant, having additional liability protection will ensure you are not personally responsible for their accident-related expenses. On the other hand, if another driver with little to no coverage causes an accident, underinsured motorist protection and uninsured motorist protection will protect you from bearing the brunt of your own medical expenses.  

Shielding Against Skyrocketing Medical Costs

Medical care costs are not what they used to be. With the rapid advancements in medical technology and the increasing complexity of treatments available, the cost of medical care has continually gone up in recent years. A higher limit on your insurance policy ensures that you are not left paying for your own medical expenses in the event of serious personal injury. And because it helps cover comprehensive medical treatments, it allows you to access the best care available without draining your bank account. 

Ensuring Adequate Compensation for Lost Wages

Often, recovering from a serious accident means you’ll miss a significant amount of work. This can have a devastating effect on your finances. Higher insurance policy limits can provide a larger safety net, covering not only your medical bills but also compensating for the lost wages during your recovery period.

Protecting Your Assets

If you cause an accident, the other driver will almost certainly look to you to cover their damages. In turn, you’ll call on your insurance company to foot the bill. A significant injury claim against you can turn into a financial nightmare if the accident victim’s expenses exceed your insurance limits because, in this case, they can sue you personally. A higher-limit insurance policy acts as a financial buffer, protecting your assets from being targeted in a legal claim. It assures that even in the face of a substantial claim, your personal assets remain untouched, preserving your financial health and your family’s well-being.

Mitigating Legal Complications

Legal battles are known for their propensity to escalate in complexity and financial demands. Higher insurance limits afford you extensive coverage, reducing the likelihood of exhausting your policy limits during a personal injury claim. This not only saves you from potential financial strain but also facilitates a smoother legal process, as many cases find quicker resolutions when adequate insurance coverage is in place.

Peace of Mind

At the crux of it all, an insurance policy with higher limits grants you peace of mind—which is priceless for many drivers. Knowing that you have a robust financial safety net in place means you don’t have to worry about “what ifs” and worst-case scenarios. 

Do you Have Questions About Insurance Coverage After an Accident?

If you’ve recently been involved in an accident and have questions about how your insurance coverage will apply, or you’re dealing with a difficult insurance company in the aftermath of an accident, reach out to the Steinberg Law Firm. At the Steinberg Law Firm, our Charleston car accident lawyers have been representing accident victims and their families since 1927. Over this time, we’ve developed a reputation among insurance companies as a no-nonsense law firm that aggressively advocates on behalf of our clients at every possible opportunity. To learn more and to schedule a free consultation today, give the Steinberg Law Firm a call at 843-720-2800. You can also reach us through our online contact form.