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THREE WORDS OF ADVICE WHEN IT COMES TO RENEWING YOUR CAR INSURANCE: BASIC IS BAD

(This article may not be copied or reposted without express consent of Andrew S. Prince.)

The new auto insurance law has made significant changes to your coverage and we have some critical consumer tips, which we believe will protect you and your family. Please print and save this information. Put it with your insurance papers so that when the time comes for your policy renewal, you can review these suggestions.

1. NEVER SELECT THE "BASIC POLICY"

Auto insurance companies will offer a "basic policy" which only provides limited medical coverage and minimal liability coverage. No individual or family with any assets or income should buy such a policy. With the "basic policy", you can be sued. If successful, a judgment can dramatically affect your financial future, your credit rating and even your ability to own or drive a car.

2. GET THE HIGHEST UNINSURED/UNDERINSURED COVERAGE

Uninsured/underinsured coverage protects you and your family if you are hit by a poorly insured driver. This coverage is critical! Remember, some drivers will continue to go without insurance, only have a small amount of insurance, or will elect the new "basic policy." You need the highest uninsured/underinsured (UI/UIM) coverage possible. This is relatively inexpensive and can be made as high as your liability coverage.

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3. GET GOOD LIABILITY PROTECTION

Liability insurance is what protects your family and assets in the event you are charged with causing an accident. High liability protection can help assure you won't be financially stripped. We recommend that you purchase no less than $100,000 bodily injury liability and uninsured/underinsured coverage. You can go up to $500,000 and anywhere in between.

4. ON THE LAWSUIT LIMITATION OPTION

The new law continues to offer the option of giving up your rights to the court system in the event of an injury, in exchange for a reduction in insurance premiums. Without those rights, though, even a prolonged and fairly serious injury may not be compensated. Weigh whether the cost savings offered is worth giving up your or your family's ability to be fairly compensated in some circumstances if an accident resulting in injury should happen. We recommend that, if at all possible, you purchase the No Limitation on Lawsuit option (zero threshold).

5. ON PERSONAL INJURY PROTECTION (PIP) OPTIONS AND MEDICAL COVERAGE

The new law allows many different options regarding medical coverage. You want to maintain your right to choose your own doctor. Do not choose any plan requiring "precertification of all treatment" by an insurance company. Choose $250,000 PIP coverage, since many private health plans exclude treatment for auto injuries or require repayment to them from any compensation awarded to you.

The new law is complicated! If you need guidance when your policy comes up for renewal, we will be happy to provide that free of charge.

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