• Erich Held, CIC

Understanding Illinois Auto Insurance

Many individuals set up their Illinois auto insurance simply because the State of Illinois requires you to have it to drive in Illinois. They never understand the coverage and how it can help them protect their vehicle and financial security.

Auto insurance basics, what's required in Illinois:

Illinois Law requires that an auto have a minimum liability protection of $25,000 bodily injury per person, $50,000 bodily injury per accident and $20,000 property damage. This is commonly referred to as “state minimum coverage.” This Is the amount you legally need to drive in Illinois. However it can be an inadequate amount to protect you financially should damage exceed those limits.

Let's review some of the basic Illinois auto insurance coverage:

Liability - It's broken down in a few ways:

Bodily Injury Per Person - is coverage in case you hit someone and hurt them. It can pay for their medical bills and injuries. This is the maximum applied to one person.

Bodily injury per accident - is the maximum your policy will pay combining all bodily injury per person.

Property Damage - is damage to the property that your vehicle hit. Damage to another car or hitting a street light are examples. You hit something that pays to fix or replace it.


Combined Single Limit Liability - Some insurance carriers combine the limits into one lump sum sometimes referred to as CSL. $75,000 minimum in Illinois. Allows funds to be used for bodily injury or property damage up to its limits.

Let's look at some liability scenarios:

Scenario #1

So you hit another vehicle and are at fault. You have state minimum insurance. The damage to that car you hit is $10,000. In the other car two people were injured. Each has $20,000 medical bills totaling $40,000. How does your policy respond?

  • The damage to the other person's car is covered. You have $20,000 property damage coverage. Their damage is $10,000.

  • Both individuals are covered for medical bills. You have $25,000 bodily injury per person and their injuries were $20,000 each.

  • Combined medical bills are covered. You have $50,000 bodily injury per accident and their combined injuries equal $40,000.

In this scenario, all works out OK. But the reality is that damage or medical bills may be higher. In 2018, the average new car in Illinois was valued at $35,000. Medical bills can be even costlier. This is why insurance agents typically look to present higher liability limits.

Let's revise our scenario and take a look at how different damage numbers can have you paying out of pocket:

Scenario #2

So you hit another vehicle and are at fault. You have state minimum insurance. The damage to that car you hit is $35,000 because the vehicle was unrepairable. In the other car three people were injured. Two people, each had $20,000 medical expenses. The third person had $50,000 medical expenses. All medical expenses totaled $90,000 (20k+20k+50k). How does your policy respond?

  • The damage to the other person's car is partially covered. You have $20,000 property damage coverage. Their damage is $35,000. You have to find a way to pay the difference of $15,000 since you don't have enough insurance. (35k-20k=15k)

  • All three individuals are covered for some medical bills. You have $25,000 bodily injury per person. So the two individuals with $20,000 in medical expenses may be OK. The third person with $50,000 medical bills is only eligible to receive $25,000 which is maximum coverage per person.

  • The combined medical bills will cause a problem. You have $50,000 bodily injury per accident and their combined injuries equal $90,000. A difference of $40,000 that you have to cover somehow.

So in this scenario you will have to figure out how to pay $55,000 (15k property damage + $40,000 medical bills) out of pocket in some way since the insurance company only pays up to the limits you chose.

We can look at endless scenarios. What happens if someone is killed? Disabled? The reality is we can't predict the future and have no way to tell you how much coverage you need. Think about if you were injured how much would you sue someone?

We haven't even talked about your car yet. The reason for this is that the bodily injury and property damage are the most important coverage. I can't stress it enough after seeing clients having $100,000 claims. Remember accidents happen, we just don't know how bad they will be.

Now let's cover damage to your vehicle. Its broken down into two optional coverage options:

  1. Collision is exactly what it means, you hit something and it pays to fix or replace your vehicle.

  2. Comprehensive refers to something other than collision. Covers things like theft, vandalism, hail damage and more. It pays to repair or replace your vehicle.

Now comprehensive or collision can have a deductible. A deducible is the amount you have to pay first for each claim, before the insurance company pays. Typical deductibles can be $500, $1000 or other. The higher the deductible the lower the premium.

Uninsured Motorist / Underinsured motorist is bodily injury coverage for you in case the other driver is at fault and has no insurance or an inadequate amount of coverage.

Towing / Roadside assistance is coverage in case you need a tow or breakdown on the road.

Rental reimbursement is coverage to rent a vehicle in case your car is in shop for a comprehensive or collision claim.

Medical is coverage for you in case you get hurt in an accident.

Glass damage is coverage to fix glass. This lowers the deductible or even eliminates it since glass damage falls under a comprehensive claim. Not having this coverage means the comprehensive deductible amount applies.

One of the things we haven't discussed yet is premium. It's the last thing I discuss when I talk with my clients. Primary concern is making sure all the coverage is in place. Not having that coverage in place when a claim arises can lead to denial of claims or having to pay out of pocket for insufficient coverage.

This is just a brief list of coverage. Policies have additional coverage available. Best approach is to talk with an agent and ask questions.


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