Texans have many choices when it comes to coverage options and the necessity of the level of protection is dependent on each individual’s needs. First and foremost, motorists in the Lone Star State should be certain to be in compliance with the state’s Financial Responsibility law at all times. Financial responsibility is defined as an individual’s ability to pay for any bodily injury or property damage that they cause as a result of a traffic accident; the majority of individuals choose to comply by purchasing a car insurance policy. Motorists who choose to buy a policy must carry proof which will need to be shown if asked by a law enforcement officer, are involved in an accident, at the time of registering or renewing vehicle’s registration, when obtaining or renewing a driver’s license or when getting a vehicle inspected.
Current Texas auto insurance law requires motorists to purchase liability limits in the amount of $25,000 for bodily injury to one person, $50,000 for bodily injuries to two or more people and $25,000 for property damage per accident; consumers will commonly see this abbreviated as 25/50/25. Higher limits may be purchased for an additional premium and may be worthwhile in order to avoid future financial hardships. Although twenty-five thousand dollars may sound like a lot of money on paper, with the high costs of medical care, this amount can be easily exhausted if the injured party happens to suffer serious injuries; if costs of medical care exceeds this amount, the other party may be able to file a lawsuit to recover compensation for the difference not covered by the policy’s limit.
Additional Texas Auto Insurance Options
A common addition to policies is Comprehensive and Collision coverage which pays for physical damage that is incurred by the policyholder’s automobile due to collision, fire, hail, vandalism, striking an animal, upset of vehicle among other perils; this will also cover theft. In most cases a deductible applies to this coverage which would need to be chosen at the time of purchase; the amount chosen would have to be paid at the time of a loss or will be subtracted from the compensation that the insurer is paying the insured if the automobile is declared a total loss or unrecovered. If a vehicle is being financed, it is very likely that the lender will require the borrower to maintain this protection throughout the term of the loan.
Uninsured/Underinsured Motorist (UM/UIM) is a valuable type of protection which pays expenses for bodily injury and property damage up to the policy’s limits sustained by the insured, family members, passengers and others driving the covered automobile with permission of the owner if they are struck by an uninsured motorist, a driver who is underinsured or if victims of a hit a run. The bodily injury portion will pay for lost wages, medical bills, pain and suffering, disfigurement, medical bills and permanent or partial disability resulting from the incident. The property damage portion will pay for repairs to the insured vehicle, the cost for a rental automobile and damages to items in the vehicle owned by the policyholder; an automatic deductible of $250 would need to be paid first by the insured towards repairs before coverage kicks in. Insurers must offer this coverage and it is up to the motorist whether to purchase it; if unwanted the consumer must reject it in writing.
Medical Payments and Personal Injury Protection (PIP) are also an option for motorists and are very similar; both pay for medical and funeral expenses for the insured, family members and passengers as a result of an accident regardless of who is at fault. The difference between the two is that PIP offers the same compensation as Medical Payments plus 80% of lost income and the cost to hire a caregiver for an injured individual; also, according to the Texas Department of Insurance an insurer must offer at least $2,500 in Personal Injury Protection which must also be rejected in writing if it is unwanted by the consumer.
Additional coverage which may be helpful and may not cost very much is Towing and Labor and Rental Reimbursement. Towing and labor will pay for the cost of a tow if a vehicle is inoperable and also for roadside assistance such as changing a tire. Rental will pay for the cost to rent a car for a set daily amount and number of days if the insured’s vehicle has been stolen or is being repaired and covered under the policy. Aside from the required liability limits, all other options are dependent on the needs of drivers; since each individual’s situation is unique, they would need to take time to determine what types of coverage will best benefit them and compare rates to see whether the desired protection is affordable.