Car Insurance Laws By States
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Auto insurance. Texas.
The Texas Personal Automobile Policy regulations offer eight types of coverage. By law you are required to have basic liability coverage. The other seven types are optional. If you are leasing or financing a new car however, dealers may require that you have collision and comprehensive coverage as well.
Penalties for violating the states' financial responsibility laws are severe. A fine of $175 and $350 may have to be paid by the first time offender. For subsequent convictions $350 to $1,000 could be charged. Apart from this, the driver's driving license can be suspended or, worse still, the automobile can be impounded by the authorities. To avoid this one has to carry the proof-of-insurance card at all times and produce for scrutiny on demand by law enforcement officer. This card is sent to the insurance policy holder after he purchases an automobile insurance.
Laws and Minimum Requirement
Texas law requires all drivers to carry liability auto insurance. Those who are still making payments on their car to a bank or other lender generally must carry collision and comprehensive coverage, in addition to the minimum liability coverage. In all states, the minimum liability is measured according to three factors: 1) Bodily injury liability maximum for one person injured in an accident, 2) Bodily injury liability maximum for all injuries in one accident, and 3) property damage liability maximum for one accident. These numbers generally appear together, in units of 1,000. The minimum auto liability coverage in Texas is 20/40/15; meaning $20,000 bodily injury for one person per accident, $40,000 bodily injury maximum for all injuries per accident, and $15,000 property damage maximum per accident.
Liability auto coverage refers to your ability to pay for accidents that you cause. In other words, if you are involved in an accident and are shown to be at fault, and you only carry liability auto coverage, your insurance will not cover any personal injury or damage to your own vehicle that resulted from the accident. It is important to realize that carrying minimum liability auto insurance, although it does meet the legal requirements, may not be enough to cover the costs of an accident. It is a good idea to consider more extensive coverage, if possible.
When you purchase insurance from a Texas auto insurance provider, you will be provided with ID cards that serve as proof of insurance required by law. You will have to show proof of insurance when you:
Texas Automobile Insurance Consumer Bill of Rights.
- Are asked for it by a law enforcement officer
- Have an accident
- Register your car or renew its registration
- Obtain or renew your driver's license
- Get your car inspected.
In addition to understanding the laws concerning financial responsibility, it is equally important to learn the laws concerning your rights as a consumer in the State of Texas. The full text of this Bill of Rights should be included with your policy, but it can also be found online at the Texas Department of Insurance.
This document contains many interesting facts about the rights of a consumer purchasing auto insurance in Texas. The following are just a few points of interest:
- An insurance company cannot deny you insurance solely on the basis of credit information. Insurers who use credit information must also consider other underwriting factors independent of credit information when deciding whether to offer coverage.
- You have the right to pay your automobile insurance premium in installments. The down payment cannot exceed the cost of two monthly payments.
- If you are denied coverage, you have the right to be told in writing why you have been denied coverage. The written statement must fully explain the decision, including the precise incidents, circumstances, or risk factors that disqualified you. It must also state the sources of information used.
- Texas offers a Safety net for those who have been denied coverage by two providers or more. Texas Automobile Insurance Plan Association, also known as TAIPA, offers minimum liability protection to those who are unable to obtain coverage elsewhere. Call (800) 580-TAIP for more information.