One of the costs for the privilege of being able to drive a car in this country is that the driver must get car insurance. This is necessary to cover driver's own expenses in a crash and to pay for the injuries suffered by an innocent victim. The duty to pay compensation for other persons' injuries and property damage from car accidents is called legal liability.
When buying a policy, the driver must obtain at least the minimum amount of liability coverage that is acceptable under New Hampshire law. The premium will obviously go up as the driver purchases higher amounts of liability coverage. If the driver is a young, industrious individual with a home and assets, it is clearly best to purchase liability insurance at the high end of the range.
In some cases, a person with a high net worth and vulnerable assets can also purchase an "umbrella" or excess coverage rider to the policy that will contribute to the recovery. This will apply where the other driver or a passenger has been severely and permanently injured, and the fair settlement amount exceeds the base liability amount purchased. On the other hand, if a driver has no assets and makes very little income, there may be little pressure to purchase high coverage as that person has little to lose if a judgment is executed.
Collision and comprehensive coverage deals with the damages to one's own vehicle sustained in car accidents. If the vehicle is old and has well over 100,000 miles on it, then there will usually be no reason to spend vital consumer dollars on the outside chance that the old vehicle will someday need drastic repairs. In such cases, it is best to eat the loss and move on from there. It's a judgment call, however, that only the New Hampshire auto owner can make based on whether the vehicle has the remaining qualities to deserve being covered by insurance.
Source: CBS News, "Should you opt for bare-bones car insurance?", Aimee Picchi, March 22, 2016