100/300 Insurance for Older Cars

Let’s be honest: when you drive an older car—say, a trusty 2012 sedan with a few dings and over 120,000 miles on the odometer—it’s tempting to cut corners on insurance. After all, why pay for full coverage when your car’s market value is barely more than your annual premium? This line of thinking has led many drivers to opt for state-minimum liability coverage. But in today’s litigious society, with medical costs and repair bills soaring, that decision could be financially catastrophic. Enter 100/300 insurance—a level of protection that might seem excessive for an older vehicle but could be one of the smartest financial moves you make.

What Exactly Is 100/300 Insurance?

Before we dive into why it matters for older cars, let’s clarify what 100/300 insurance means. It’s a type of liability coverage that provides:

• Bodily Injury Liability per person: Up to $100,000 for injuries to one person in an accident you cause.
• Bodily Injury Liability per accident: Up to $300,000 total for all injuries in one accident.
• It often comes bundled with Property Damage Liability (e.g., 100/300/100), which covers damage you cause to others’ property.

Unlike collision or comprehensive insurance, which protect your vehicle, liability insurance protects your assets—your savings, your home, your future earnings—if you’re found at fault in an accident.

The Great Misconception: "My Car Isn't Worth Much, So I Don’t Need Much Insurance"

This is the most common—and riskiest—assumption drivers make about older cars. True, if your car is totaled, an insurer might only pay you its actual cash value, which could be low. But liability insurance isn’t about your car’s value; it’s about the damage you might cause to others.

Consider today’s economic realities:

• Sky-high medical costs: A single ambulance ride can cost over $1,200. An emergency room visit averages several thousand dollars. Serious injuries requiring surgery or long-term care can easily exceed $100,000 per person.
• Expensive repairs on modern vehicles: Even a minor fender-bender with a new electric vehicle can cost $20,000+ due to sophisticated sensors and materials.
• Litigation culture: If you cause an accident and your insurance is insufficient, you could be personally sued for the difference.

Your 2008 SUV might only be worth $5,000, but the Tesla you rear-end—and its injured driver—could represent a $300,000 liability. State minimums (often as low as 25/50/25) are laughably inadequate in such scenarios.

Why 100/300 Coverage Makes Economic Sense for Older Cars

1. Protecting Your Life’s Savings from a Single Mistake

An accident can happen in a split second—a moment of distraction, a slippery road. If you’re at fault and your insurance coverage maxes out, the other party can go after your personal assets. This means your house, your savings, and even your future wages could be garnished. For most people, their car is not their most valuable asset—their home and retirement funds are. 100/300 insurance acts as a crucial shield, ensuring a mistake on the road doesn’t wipe out your financial security.

2. The Premium Isn’t as High as You Think

Many drivers avoid higher liability limits assuming the cost will be prohibitive. However, because the insurance company isn’t on the hook for repairing your valuable car (since you likely forego collision coverage), the jump from state minimums to 100/300 is often surprisingly affordable. Increasing your liability protection is one of the most cost-effective upgrades you can make to your policy. For potentially just a few more dollars a month, you buy immense peace of mind.

3. It Covers More Than Just Car Accidents

Liability coverage on your auto policy can sometimes extend to incidents you might not expect. For example, if you cause an accident while driving a rental car (in many cases), or even if your dog bites someone while you’re on a road trip, your auto liability insurance could provide coverage. Having a robust 100/300 policy means you’re better protected in these edge-case scenarios as well.

When Might You Consider Lower Limits?

While 100/300 is a wise choice for most, it’s not a one-size-fits-all solution. If you truly have no assets to protect—no home, no savings, no significant income—then the risk of being sued personally is lower. However, even in this case, consider that future earnings could be at risk. Furthermore, if you simply cannot afford the difference in premium, sticking with state minimums is better than driving uninsured. But view this as a temporary, high-risk solution.

How to Decide: A Practical Checklist for Owners of Older Cars

1. Asset Audit: Tally up your net worth. If it exceeds your state’s minimum liability limits, you are under-insured.
2. Get Quotes: Contact your insurer and ask for a quote to increase your liability from your current level to 100/300. You will likely be pleasantly surprised by the marginal cost.
3. Consider an Umbrella Policy: If your net worth is high ($500,000+), consider supplementing 100/300 auto coverage with a low-cost umbrella policy for an extra $1-2 million in protection.
4. Review Regularly: Re-evaluate your coverage every renewal period. As your assets grow, so should your protection.

The Bottom Line: It’s About Risk Management, Not Car Value

Insuring an older car isn’t about protecting the metal and plastic you drive; it’s about protecting the life you’ve built. In our unpredictable world, where a single accident can lead to financial ruin, adequate liability insurance is not a luxury—it’s a necessity. 100/300 coverage provides a solid, affordable foundation of protection that aligns with the real costs of accidents in the 2020s. Don’t let the age of your car lull you into a false sense of security. Upgrade your liability, drive with confidence, and know that you’ve made a prudent choice for your future.