Working With Your Insurance Agent

« Back to Home

Answers To Common Questions About Minimum Car Insurance

Posted on

If you have just paid off your car or you have been driving a paid-for vehicle for a while now, it is a good idea to understand exactly what liability insurance does and does not cover. Although liability insurance, or a bond that requires similar coverage, is required by law for every driver in almost every state, many drivers erroneously think that it only covers expenses to the other vehicle. However, you may have more coverage than you think, even with the minimum liability policy, and the following information will help to clarify your understanding of this important policy.

#1-Don't All States Have The Same Requirements For Car Insurance?

One of the more common mistakes that people will make is assuming that liability insurance requirements are the same in each state. The truth is that not only does the dollar amount of coverage that you need vary by state, but even the type of coverage you will be required to carry on your vehicle also changes as you move from one state to another. It is crucial to comply with all of the state laws about car insurance or you could be fined. In some instances, you could even lose your right to drive simply due to not having the minimum amount of car insurance on your vehicle.

#2-How Different Will Those Laws Be?

One example of those differences can be seen in Illinois. That state requires drivers to have insurance to cover uninsured motorists. That policy will protect you if you are in an accident with someone who either lacks insurance on their vehicle or does not have enough insurance to cover all of the costs from the accident. In comparison, Alabama and Arizona only require drivers to carry liability coverage for property damage and bodily injury, but they require very different amounts of insurance.

#3-How Long Do You Have To Change Insurance Policies When You Move To A New State?

If you move to a new state, you have only a limited period of time in which to comply with state laws about registering and inspecting your vehicle, as well as getting a driver's license for your new state. As part of that, you will probably need to show your insurance for that state. You should check with your state for the rules there, but in general, you will have 30-60 days to comply with insurance laws in your new state.

In conclusion, auto insurance is required by law for any vehicle driven on public roads. Failing to maintain the minimum amount of coverage on your car can result in significant penalties and even the loss of your driving privileges. Therefore, it is a good idea to understand your policy and never get behind the wheel of a car without making sure that it has adequate coverage.

For more information about liability insurance, see Family Insurance Centers or an insurance agent in your state.