On the first of every month I send my dad $95 with the memo "Corolla." He sends back a thumbs-up. This has been going on since I moved home in July 2024, and if you'd asked me what the $95 actually bought, I would have said "car insurance" and changed the subject.
My 2012 Corolla is on my parents' auto policy because it lives in their driveway and I live in their house. When Dad's agent last renewed the policy, Dad asked what my car and I added to the total, and the answer was close to $95 a month. So that's what I pay. Last weekend I finally asked to see the declarations page, which is the summary sheet at the front of the policy. My dad printed it, of course. He reads every bill twice and every policy three times.
What's actually on the page
The declarations page lists the drivers, the cars, and what each car is covered for, with a price next to each line. For my car, here's what it says, in my own words:
- Liability: $100,000 per person and $300,000 per accident for injuries I cause, plus property damage coverage for other people's cars and stuff. This is the part that protects other people from me, and it's the part that protects me from being sued into the ground.
- Uninsured and underinsured motorist coverage, matching the liability limits. This pays for my injuries if someone without enough insurance hits me.
- Collision with a $500 deductible. If I hit something, the policy pays to fix my car, after I pay the first $500.
- Comprehensive with a $500 deductible. This covers things that aren't a crash, like theft, hail or a tree branch.
- Roadside assistance, which is a small line item and covers things like a tow or a jump start.
I learned that "full coverage" isn't a real line on the page. People use it to mean liability plus collision plus comprehensive. I'd been saying it for years like it was a product.
The state minimum vs. what we carry
Illinois requires every driver to carry liability insurance, and the required minimums are a lot lower than what we have, somewhere around $25,000 per person for injuries. Illinois also requires uninsured motorist coverage. My dad's view is that the minimum is a number designed to make it legal to drive, not a number designed to cover a real accident on Green Bay Road with a newer car. He picked 100/300 years ago and has never moved off it. I asked if I needed that much, and he said "you need it until the day you need more."
Collision was the part I questioned. My car cost $5,900 in 2022 and has about 120,000 miles on it now. If it got totaled, the payout would be what the car is worth, minus the $500. My dad pointed out that I don't have $5,000 sitting around to replace a car without wrecking my emergency fund, which is nowhere near that size yet. So collision stays, at least for now. I wrote "revisit collision when the fund is bigger" in the club sheet, because I like having a rule I can check later.
Why my share is cheaper than going alone
Being on my parents' policy gets me some discounts I wouldn't have by myself: more than one car on the policy, my parents' long history with the same company, and the bundle with the house. A friend from work who's 25 and has her own policy pays a lot more than $95 for a car that's not much newer. I'm not going to pretend I earned that rate. I'm borrowing it.
It also means that when I move out, the rate will change. A car is generally insured where it's kept, so once my Corolla lives at my own address, it needs to come off my parents' policy and onto one in my name. I don't have a move date yet, just a spreadsheet tab that says "someday apartment." But I added "own car insurance" to that tab with a guess of $150 a month, so future me isn't surprised.
The honest takeaway is that I'd been paying $95 a month for two years without knowing that most of it buys protection for other people if I mess up. That actually made me feel better about it. It's the least glamorous $95 in my budget and probably the most important.
