The residents of Alaska paid an average of $2,200 for car insurance in 2009. However, the national average for 2009 was only $1,700. Additionally, the average premium raised 25% since 2008. Contrary to popular belief, the state does not “fix” their auto insurance rates. Knowing what types and amounts of coverage are required by the state is the first step for an Alaska resident to find the best deal on their car insurance. Many residents may be paying for more coverage than is necessary for their particular situation. Let’s take a look at what all drivers in Alaska should have, as a bare minimum.
Alaska follows a Tort system. This means that someone involved in an accident must be found at fault, and they, along with their insurance company, are responsible for the costs of the damages involved. Basically, this means that you must establish financial responsibility to operate a vehicle in Alaska.
As required by state law, Alaska drivers must carry a minimal $50,000 Bodily Injury per person, $100,000 Bodily Injury per accident, and $25,000 Property Damage liability. This package is commonly referred to as 50/100/25 coverage, and residents should know this before customizing any insurance coverage. This is the basic coverage required by the state, so any other types, or higher amounts of coverage, are purely optional. However, automobiles that are financed may require additional limits per their lenders.
Alaska law does not require drivers to carry Uninsured/Underinsured Motorist coverage. However, drivers should familiarize themselves with this type of coverage to see if it would be beneficial.
Now that you know the legal requirements for Alaska car insurance, you will be able to customize your personal insurance policy to meet your needs. Keep in mind that these are all minimal values, and they may be raised at your discretion from various factors such as the age and approximate value of the vehicle to be insured. Also keep in mind that many factors including credit history, driving record, and age of driver affect insurance rates, so rates for similar policies will always vary from person to person.