Why do I need auto insurance?
Answer:
It’s the law.  Do you know the laws


in your state?  Nearly all states require that drivers carry a minimum amount of auto liability insurance.

Actually, Tennessee is the only state in the country with no compulsory minimum automobile insurance guideline.  They require simply that proof of financial responsibility be in the vehicle at all times—but financial responsibility doesn't have to be insurance coverage.   State minimum auto insurance liability coverage is generally quite low which, for most, means it’s very affordable.  There’s really no excuse not to have it, and why wouldn’t you?  When you consider the degree of seriousness of many of the nation’s auto accidents, the costs of treating injured people from these events can be staggering.  Even a short stay in a hospital without surgeries and advanced procedures can run into the tens of thousands of dollars.   With the minimum amounts of liability coverage as low as $10,000 (for bodily injury to a single person) in states like Louisiana, and Florida—these amounts are hardly adequate. 

Besides your home state requiring you to carry it, you need auto insurance to make sure that if you cause an accident, you can afford to pay for the damage you caused.  In addition to the basic liability coverage , you also may want to include Comprehensive (Comp) and Collision —coverages that ensure you can replace or repair your vehicle in the event it’s damaged.  Although states don’t require Comp & Collision—the bank that loaned you the money to buy that shiny new car probably will.  With a new car and a whopping loan to go along with it—you won’t want to be out a vehicle when it’s wrecked and still be responsible for making a payment on a worthless pile of scrap metal in the junk yard.
 
So there are really 3 main reasons you need auto insurance:
1. It’s the law in most states.  Hefty fines, loss of your license and even jail time can result if you’re caught without auto insurance.
2. You’ll set yourself on a clear path to bankruptcy without coverage if your unintentional actions behind the wheel cause injury or death to another human being.  Causing property damage with your vehicle could also land you in the poor house if you don’t carry auto insurance. 
3. You need to protect your hardware investment and the loan you acquired to make that investment.  In other words… you’ll still be responsible for getting from point A to point B when you don’t have your car.  And likewise—the bank will expect that you’ll continue to make the payments as well.

Auto insurance is a “must-have”…  And Tennessee notwithstanding—we should all consider ourselves lucky that most states require auto insurance coverage and that there are insurance companies around to absorb the risk.  The road can be a hazardous place...

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