But then comes the reality check. First, you
need to get together the money to buy that perfect set of wheels.
That means getting a job or hitting up mom and dad for the
cash. Then beyond the purchase looms the cost of auto insurance—a
legal requirement for drivers in Hawai‘i and most other
Are you prepared to spend anywhere from $50-$200 a month for
the privilege of legally operating that dream car?
In Hawai‘i, a conviction for driving without insurance
carries a $1,000 fine, a blemish on your motor vehicle record,
and increased insurance costs. As the old adage says, don’t
do the crime if you can’t do the time.
An auto insurance policy is a contract between you and an insurance
company. You pay a premium, and in exchange, the insurance
company promises to pay for specific car-related financial
losses during the term of the policy.
Basic auto insurance is designed to protect you financially.
If you seriously injure another person, you can be held liable
for their medical expenses, rehabilitative therapy, lost earnings,
and pain and suffering. These costs can easily add up to $100,000
per injured person if you are sued. Hawai‘i law requires
bodily injury and personal property insurance coverage in order
to prevent the number of lawsuits involving injury and property
damage from overloading the courts.
Insurance companies also offer other forms of coverage not
required by law. These include comprehensive coverage that
will pay for the repair or replacement of your own vehicle
if it is stolen, vandalized, or damaged in a fire. Collision
is another optional coverage that will repair or replace your
car if it is involved in an accident.
Although comprehensive and collision coverages are not required
by law, if your car is financed through a bank or credit union,
or leased, the lender or leasing agent will require you to
Other optional coverages include uninsured motorist coverage
that protects you if you suffer injury or damage from a driver
who has no insurance, and underinsured coverage that reimburses
you if the cost of your injuries exceeds the amount of insurance
carried by the other party. Emergency roadside assistance,
accidental death benefits, funeral benefits, rental car expenses
(so you can drive while your car is being repaired), and wage-loss
benefits if an injury prevents you from working are other coverages
The costs for all these coverages can add up quickly. And for
a new driver purchasing insurance for the first time, costs
can run even higher since they have not established a record
of safe driving.
So what is the alternative? Currently, none. Hawai‘i
is a no-fault insurance state and therefore basic coverages
are legally required when you are behind the wheel. Other alternatives,
such as adding the cost of insurance to gasoline costs in a “pay
at the pump” system have been proposed in the past but
So get ready to pay for the freedom of the road or else invest
in the much more economical monthly bus pass. Of course, then
you won’t have the wind blowing in your hair, but at
least you will be able to afford some of the other pleasures
that life has to offer.