Five reasons to have car insurance

Having auto insurance is a legal requirement in 48 states and the District of Columbia. If you cause an accident, the auto liability coverage required in your auto insurance policy helps pay for the other party's medical bills and property damage. It also helps pay your legal fees if you are sued for the accident.

• TO COMPLY WITH STATE LAWS

Each state's laws establish the minimum limits of auto liability coverage that drivers are required to purchase. A boundary is a maximum amount your insurer will pay for a covered claim. It is advisable to increase your coverage limits beyond your state's minimum requirements. Otherwise, you could end up paying out of pocket if, for example, you cause an accident that injures another driver and the medical bills exceed your coverage limits. Depending on where you live, some states require you to purchase additional coverages on your auto insurance policy, such as uninsured motorist coverage or personal injury protection.

• TO HELP PROTECT YOUR FINANCES

If you cause an auto accident, you could be liable for costs related to the accident. These may include legal fees, the injured person's medical expenses, or your compensation for lost income. Liability coverage can help pay these costs. Without liability coverage (or adequate liability limits), you may have to pay these costs out of your pocket.

• TO HELP PROTECT YOUR VEHICLE

Even if you own your vehicle, it's wise to keep collision and comprehensive coverage on your auto insurance policy. What if your car is damaged in a hail storm? Comprehensive coverage can help pay for repairs or replacement if your vehicle is stolen or damaged by something other than a collision, such as falling objects or fire.

• TO HELP PROTECT YOURSELF

Although liability coverage is required by law in most states, many people drive without it. Uninsured motorist coverage helps pay your medical bills if an uninsured driver hits you. This coverage is mandatory in some states and optional in others.

Having the right auto insurance coverage can do more than meet a legal requirement. An auto insurance policy can help protect your vehicle, wallet, and even your peace of mind. Talk to a local agent who can help you choose the right coverage for your needs.