Requirements for car insurance include more than a car and a method for payment. Just like homeowners insurance, you have obligations to the company to protect your property and lower their risks. Finding reliable insurance for certain drivers can be a headache if you don’t know what the requirements are. It is important to always check the requirements that are set by your insurance provider when you go to buy a policy. Never buy insurance without knowing what is required of you as a customer.
Basic Car Insurance Requirements (#/#/#)
When purchasing an auto insurance policy, there will be a list of numbers for the minimum amount of coverage. For example, in the state of New York, the requirements are 25/50/10. The first number refer to the maximum amount (in thousands) that each individual injured in an accident would receive.
The second number refers to the total maximum limit that could be paid for damages in an accident. The third number is the total amount (in thousands) that can be used towards property damage. So for the state of New York, you could have up to $25,000 for each person as a max, $50,000 for your total bodily injury maximum, and $10,000 set aside for property damage. Any excessive damage that is caused needs to be paid out of pocket.
- Bodily Injury – The first number is the individual max that can be paid per person for injuries in an accident, while the second number is the entire pool of cash that can be used to cover all injured people in the accident.
- Property & Liability Damage – This refers to the third number in the sequence listed. Just like the other two numbers, the amount of money that needs to be paid for property damage will be dependent upon the state in which you live.
Deciding on coverage amounts
You have a responsibility to be honest when buying insurance. Most policies cover an estimated amount of miles. Regular use entails around 12,000 miles per year, but you may get discounts if you drive less. You also pose more liability – and thus pay a higher premium – when you drive significantly more than average. More time on the road means you have more opportunity to get in an accident. You may also have discounts for things like garage use or using a car alarm.
A fair number of people never look past the “amount due” on their policy, and don’t know they aren’t meeting their requirements for car insurance. Others know and hope it won’t catch up to them in the end; the truth is that it might work against them later when going to file an insurance claim.
If you’re ever in a situation where the insurance company can prove you fell short of your obligations, they don’t have to honor your policy either. A deal isn’t a deal if it doesn’t give you the protection you need. Make sure whatever price you agree to pay comes with conditions you can agree to follow, or you may find yourself without coverage when you need it most.
Auto Insurance Requirements and Unwritten Rules
Drunk driving causes numerous deaths each year; needless deaths. No one has to drink alcohol if they’ll be behind the wheel, but it happens on a regular basis. Insurance companies know this, and do a good job of investigating claims with drugs and alcohol in mind. However, these aren’t the only ways we fail to protect ourselves on the road.
- Avoid eating in the car. Fast food businesses thrive because breakfast, lunch and dinner have become mobile meals, but some food is easier to eat in the car than others. Sloppy burgers, pizza, tacos and anything involving utensils knowingly poses a risk to your safety and to that of other drivers. Although this isn’t a car insurance requirement, it will obviously help to be a safe driver by not eating while driving; this is risky and could get you into an accident.
- Tune into the road. The car radio has evolved from a flip of the dial to multiple CD holders, and digital radio stations complete with video feeds. Add to that portable TV and video games, and it’s easy to let your focus wander. There’s really no need to be playing around while on the road with technology; focus on keeping yourself safe and your insurance low.
- Put away the cell phone. Most areas have laws now that restrict cell phone calls, texting, gaming and video conferencing while driving. Those that don’t probably should, and regardless of what your city law book says, your insurance company may very well consider these things a violation of your policy.
- Follow the rules of the road. It goes without saying – or rather, it should – that following basic traffic laws is a requirement for car insurance coverage. Drivers who receive too many tickets often find themselves out of an insurance carrier. Replacement policies for this kind of cancellation can have impractical terms and be very expensive.
Requirements When Making Auto Insurance Payments
In addition to the suggestions above, there are plenty of financed car insurance requirements that you should be aware of with your insurer. If you fail to make payments by a certain date towards your premiums, claims, etc. – you may get into trouble or kicked off of your policy. Always make sure that you are up to date with your payments and don’t think that you can get away with skipping your insurance payments.