“Minimum Limits” . . . you’ve probably heard of them, but do you really know what they mean? And more importantly—do you know what they mean for you and your auto insurance policy? As you probably already know, in order to legally operate a vehicle most states require that you have auto insurance. But even more specific than that, most states also require that your auto insurance policy have specific “minimum limits” of coverage.
The specifics of these minimum limits vary from state to state, so it’s important that you understand what they are and what they mean for you and your auto insurance policy.
DEFINITION OF “MINIMUM LIMITS”:
The lowest total dollar amount of liability insurance coverage allowed by the state, as specified individually for each type of required auto insurance coverage.
WHY REQUIRE MINIMUM LIMITS IN THE FIRST PLACE?
So why require minimum limits in the first place? Why does the state of Utah care, and what right do they have to regulate how much liability coverage you have? Those are all good questions—but if you stop and think about the purpose minimum limits aim to serve, you’ll understand that they are truly in place for the protection of everyone . . . including yourself!
Minimum limits (as determined by the state) are meant to represent an amount considered as minimally sufficient coverage for you and others, should you find yourself party to a car accident. The hope is that these amounts are sufficient enough to off-set any potentially drastic financial consequences, which might leave you or the other party unable to pay for injuries or damages incurred.
However, it should be noted that minimum limits are not designed to be enough to truly cover all costs involved in most accidents—particularly major accidents. Whatever costs of the accident fall outside of your limits, are your financial responsibility. As you can see, this could cause major financial disaster if you don’t have somewhat sufficient limits to protect yourself . . . and thus, the purpose and protection of minimum limits for the good of all involved.
WHAT COVERAGES ARE REQUIRED IN UTAH, AND WHAT ARE THEIR MINIMUM LIMITS?
As you may already know, there are several different types of coverage you can obtain within your auto insurance policy—but only two of them are actually required by the state of Utah. These two REQUIRED coverages and their corresponding minimum limits are:
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BODILY INJURY LIABILITY
PROVIDES COVERAGE FOR INJURIES YOU CAUSE TO SOMEONE ELSE.
UTAH’S REQUIRED MINIMUM LIMITS: $25,000 PER PERSON / $65,000 PER ACCIDENT
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PROPERTY DAMAGE LIABILITY
PROVIDES COVERAGE FOR ANY DAMAGES YOU CAUSE TO SOMEONE ELSE’S PROPERTY.
UTAH’S REQUIRED MINIMUM LIMITS: $15,000 PER ACCIDENT
Other common coverages offered in an auto insurance policy which are considered “optional”—those not required by the state of Utah—are as follows:
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COLLISION COVERAGE
Covers any damage to your car that is the result of a collision. If you have financed your vehicle your lender will most likely require this coverage, even thought the state does not. You may want to check with your lender to find out if they require a specific coverage amount and/or deductible.
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COMPREHENSIVE COVERAGE
Covers any damage to your car that didn’t involve a collision. This could include theft, fire, and vandalism. If you have financed your vehicle, your lender will most likely require this coverage, even though the state does not.
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UNINSURED & UNDERINSURED MOTORIST COVERAGE
Gives you protection if you’re injured in a collision with a driver who’s either uninsured or underinsured.
