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Colorado Car Insurance Cost Determination Factors and Minimum Requirements

Colorado car insurance coverage is a relatively simple proposition. All drivers are required by law to "maintain continuous financial responsibility." To meet this requirement, each person who drives must have liability insurance in place on his or her vehicle.

What is Liability Insurance?
Liability insurance is a product that you buy to pay for the medical expenses incurred by a person injured in an accident where you are considered to be the at-fault driver. Liability insurance for property damage pays for the costs associated with repairing the other driver's vehicle, as well as damage to a sign post, fence, mail box, shed, or building.

Minimum Levels of Liability Insurance Coverage
Under Colorado law, the minimum levels of liability insurance are 25/50/15. This means you must have at least $15,000 in liability insurance for an individual injured in an accident and $50,000 in liability coverage for all people injured in an accident. In addition, Colorado drivers are required to carry $15,000 in liability insurance for property damage.

Keep in mind that the figures listed here are the minimum levels of coverage required by law. You always have the option of buying a policy with a higher policy limit. If a serious accident occurred and you only have the minimum level of coverage mandated by law in place, your insurance company would pay benefits up to the policy limit. You would be expected to cover any additional expenses out of your own pocket.

Factors That Affect Rates
There are several factors that the insurer will consider when preparing a quote for Colorado car insurance. Your previous driving record is one of them. If you were the at-fault driver in an accident within the previous three-five years, you will likely be charged a higher rate. The amount of driving that you do each year. Drivers who put many miles on their vehicles are charged higher rates.

Your marital status also has a bearing on your premium rates. Since married people make fewer claims than single people, saying, "I do" can give you a break on car insurance. The insurance company will also ask you where you live, since insurance providers keep track of neighborhoods with higher levels of theft and vandalism. Policyholders who live in these areas are charged more for their coverage.

The make and model of your car is also factored in when you ask for a quote on what Colorado car insurance costs. If you happen to drive a model that has a history of having a large number of claims made against it, you will be charged a higher rate. Getting a car insurance rate quote from a number of insurance companies is a good way to avoid paying more than you have to for your coverage.

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