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Do You Really Need Car Insurance If Your Car Is Not Worth Much?

Are you ready to buy a car with cash? When buying an old car that is not worth a lot, do you need to purchase auto insurance? After all, is car insurance really a necessity for a vehicle that is not worth a lot? Here are several things to know about this if you are deciding whether or not you need car insurance, based on the age of your vehicle.

Your State Might Require It

One of the main reasons you might want to buy car insurance is to meet your state's legal requirements. Almost all the states in the U.S. require auto insurance for car owners and drivers. States have these rules to protect innocent people who drive, and anyone who drives a car might need to purchase a car insurance policy. If you are not sure if your state requires it, ask an insurance agent. An agent can provide more details about your state's rules and requirements. If your state requires it, you must purchase the necessary coverage. You can save money by purchasing a minimum-coverage policy, and your insurance agent can help you understand more about your options.

Car Insurance Protects You in Several Ways

A minimum-coverage policy might provide several coverage types, and it will always provide liability coverage. Liability coverage is the most basic form of car insurance you can buy. While it does not directly protect your vehicle, it protects you differently.

Imagine if you did not see a car pull out in front of you. If you rear-ended the car, you would be the at-fault driver, which means you must pay for the other car's damages. Fortunately, liability covers these incidents. You will not have to pay for the damages yourself. Your insurance will pay them for you through your liability coverage. Without liability, the other driver could sue you for the damages, and you might have to pay the costs out of your pocket. Insurance can protect you financially in such an accident so that you won't have to pay for damages for the other driver.

Therefore, having liability insurance is vital if you drive. You take on too many risks driving without it. You can add other coverage types to your policy, but you might not need to if your car is not worth a lot. You can talk to your insurance agent to learn more about your options if you need car insurance.