Happy graduation season! If you’re a new graduate with a new-to-you vehicle, or you’re a parent of a graduate, you’ll need to make sure the car is insured.
Do you know how much auto insurance is needed for a first-time driver? Read our first-time car insurance guide below.
Insurance Needed for First-Time Drivers
State Minimum Coverages
Colorado law requires that drivers have liability insurance that covers at least:
- $25,000 per person for bodily injury in any one accident
- $50,000 in total for all bodily injury in any one accident
- $15,000 per accident for property damage
However, that’s not enough coverage for a first-time driver, according to Colorado Farm Bureau Insurance agent Brenden Buhl. “I’ve seen broken arm claims come in at $115,000,” he says.
Our Minimum Coverage Recommendation
He recommends that teen drivers start out with:
- $100,000 per person for bodily injury in any one accident
- $300,000 in total for all bodily injury in any one accident
- $100,000 per accident for property damage
If $100,000 per person, $300,000 per accident makes the premiums unaffordable, he suggests going with coverage of $50,000 per person and $100,000 per accident for bodily injury.
“The state minimum just doesn’t seem like an appropriate or responsible amount of coverage for anybody,” he says.
It’s important to carry enough liability insurance to fully protect yourself and your assets. The at-fault driver is legally responsible for all accident-related expenses. If your liability insurance doesn’t cover those expenses, the injured party could sue you and garnish your wages to collect the remaining amount. If you are under 18, they could sue your parents or legal guardian.
Other Auto Insurance Coverages
Uninsured motorists, comprehensive, and collision coverages are not required by law. However, if you are financing a car, these coverages may be required by your lender.
Uninsured/Underinsured Motorist Insurance
Uninsured/Underinsured motorist insurance covers you and your passengers if you are involved in an accident with an at-fault driver who doesn’t carry any insurance or doesn’t carry enough insurance to pay for your injuries.
These coverages will help pay medical expenses. By law, insurers must offer you these coverages. If these coverages do not interest you, you must reject them in writing.
Comprehensive insurance covers damage to your car from occurrences such as adverse weather events, fire, theft, and vandalism.
Collision insurance covers damage to your car caused by a collision with an object or another vehicle.
Medical Payments Coverage
By law, insurers must offer you this coverage. If this coverage does not interest you, you much reject it in writing. This coverage is not as well known as other types of auto insurance. It pays for accident-related medical transport and medical bills that you or your passengers may incur, regardless as to who was at fault.
Medical payments insurance coverage starts at $5,000, and unlike other types of coverage (including health insurance), you don’t have to pay a deductible.
Medical payments coverage pays for accident-related medical transport and bills that you or your passengers incur.
Your medical payments insurance may also cover you if you’re injured in an accident while riding in someone else’s car, even if that person doesn’t have medical payments coverage.
You do not need to pay back medical payment insurance, even if you later receive a legal settlement.
How to Lower Auto Insurance for First-Time Drivers
First-time drivers are inexperienced and considered high-risk. Until they prove themselves to be mature, safe drivers, their insurance will cost more. There may be ways to lower their premiums, though.
- Want to carry a responsible amount of coverage but pay a lower premium? A policy with a higher-deductible is a great option.
- Are you a good student? You may qualify for an auto insurance discount.
- Sharing a parent’s car and only driving occasionally? Your insurance will cost less than if you drive your own car whenever you like.
- Sedans are less expensive to insure than sports cars and SUVs.
- Obey traffic laws. Speeding and other traffic tickets raise insurance premiums.
Are You a First-Time Driver and Ready to Insure Your Car?
Get in touch with a Farm Bureau Insurance agent today! We’re happy to speak with you about your auto insurance needs.