State Laws Regarding Insurance Coverage

Wisconsin is the 49th state across the U.S. that mandates motorists purchase a minimum of liability insurance coverage. Liability policies cover property damages (property and automobiles) and bodily injury (medical expenses, lost wages, pain and suffering) caused to others in the event of a vehicle accident. Liability also covers any defense and court costs. State laws not only establish the minimal insurance requirement, but in addition to insurance companies, states often regulate the maximum amount of liability insurance coverage that you may purchase.

Personal Injury Protection (PIP) Insurance Coverage

While the 49 states that require motorists to purchase a minimum of liability coverage, several states including Florida, New York and New Jersey also mandate purchasing additional Personal Injury Protection (PIP). Also referred to as “no fault” coverage, PIP covers lost wages and medical expenses of insured drivers in the event of an accident. The purpose of the automobile insurance coverage protection is to ensure PIP patients receive proper medical treatment and protects physicians providing treatment to patients unable to pay for medical care.

Consequences for Uninsured Drivers

If you’re driving without auto insurance coverage, be prepared for unsympathetic consequences. In most states driving uninsured is a crime with harsh penalties, especially if you’re at fault in a serious accident. On the scene of an accident you are required to show proof of insurance coverage. While presenting proof of insurance is admissible at your court case, the date on your insurance card must be valid at the time of the accident. If you lack proof of car insurance coverage, expect to go before a judge and more than likely endure hefty fines.

The consequences of venturing out without proper coverage for insurance may also include suspension of driver’s license or license plates, especially if you live in California or Ohio. The suspension of license plates typically means vehicles are impounded or immobilized for a minimum of 30 days. Perhaps the greatest risk of driving without insurance coverage is the fact it makes you vulnerable for liability in the event of an accident. Not only are you responsible for the property damages and medical expenses incurred due to the accident, but you’re also responsible for all other parties involved. Such scenarios leave you defenseless to lawsuits. If you can’t afford to pay for damages, then your property or other valuable assets may be seized to recoup damages.

With the numerous companies offering affordable insurance coverage, purchasing policies before an accident is a wise decision that prevents hefty fines, suspension of licenses or plates and lawsuits that could potentially cause you to file bankruptcy.

Insurance Coverage References:

-Auto Insurance coverage by state
-How car insurance works?
-State-by-State Car insurance requirements

What’s No Fault Auto Coverage?

No Fault Car Insurance is a new type of auto insurance coverage that places the responsibility for repairs arising from a traffic accident, not on the individual that is responsible for the accident, but on each individual automobile owner.  This means that if someone runs into your car, you are responsible for the damages they caused to your vehicle.  You will also be responsible for any injuries you sustain along with the injuries of any passengers in your vehicle, despite of who is at fault for the fender bender.

What Should You Know about No Fault Insurance Coverage?

Personal Injury Protection (PIP) is a mandatory choice in the states with No Fault Insurance coverage laws.  These policies cover the insured for any injuries sustained.  But in a “No Fault” system, it leaves a lot of room for fraud.  There have been issues with the laws governing who can report the medical status of the claimant making it easy for bogus claims to be filed costing the insurance companies millions and increasing the premiums for the honest policy holder.

Clinics that provide the medical diagnoses for the insurance coverage claims are, in some jurisdictions, subject to extremely limited regulations in how they receive their licenses.  In some cases, it has been found that these so called clinics do not even have medical personnel but are staffed by what amounts to be witch doctors.

In Detroit, policy holders have been required to purchase PIP policies that have no cap to the damages that are paid pushing premiums as high as $6000 per year.  This has also increased the prospects for fraud, as the damages that are paid can now be for the life of the victim. Now all one has to do is find an appropriate clinic, who will claim that the victim requires lifetime care which then results in a fraudulent insurance coverage claim that can be valued into the millions quite easily.

No Fault Insurance coverage is about the same as letting people get away with a hit and run; however, in those cases there’s  legal recourse should the perpetrator be apprehended.  In the states that have chosen to require these types of insurance coverage policies, the victim of a car accident is then victimized again as they will most likely face an increased premium, even though they were not at fault.
Instead of calling it “No Fault” Insurance coverage, perhaps it should be renamed: “No Accountability” Insurance coverage.

Related Links to Insurance Coverage:

Basics of Auto insurance Coverage

Learn more about auto insurance coverage

Problems with No-Fault Car insurance

Why you may ask? Instead of using your FICO score, insurers examine what’s referred to as an “insurance score” to determine whether or not you’ll be a potential risk for filing claims – a lower credit score, according to some experts in the industry, means that a customer with a low credit score will be a higher risk than those with higher digits. Ultimately, cheaper car insurance premiums do depend on your current credit score.

Affordable Car Insurance and Good Credit Scores

The recent statistics from a study conducted by CarInsurance.com are promising for individuals with credit scores of 750 save on average $783 each year on lower car insurance. The 40% of customers with a credit score over 750 can expect to save almost $23,000 on cheaper auto insurance costs over the span of an adult lifetime.

For teen drivers between the ages of 16-24, credit scores aren’t really significant in factoring cheaper auto insurance because the majority of teens don’t yet have established credit; however consider the following statistics for teens with established credit:

• Credit scores above 750 pay an average of $2,515/yr
• Credit scores between 650-749 pay an average of $2,387/yr
• Credit scores between 500-649 pay an average of $2,692/yr
• No credit pay an average of $4,191

Young adults between the ages of 25-34 with credit scores over 750 and a clean driving record qualify for lower vehicle insurance and pay an average of $1,155 annually, compared to $1,938 to the same population with credit scores below the magical 750. Other statistics revealed the average driver between the ages of 25-34 with:

• Credit scores between 650-749 pay an average of $1,658/yr
• Credit scores between 500-649 pay an average of $2,023/yr
• No credit pays an average of $2,182/yr.

Ways to Boost Your Credit Score to Become Eligible for Cheaper Car Insurance
Even if your current credit score is less than perfect, there are ways to improve your credit to take advantage of lower vehicle insurance premiums.

• Routinely check your credit score from the 3 major credit reporting agencies
• Immediately report any errors.
• Always make payments on time.
• Never allow coverage to lapse.
• Establish credit in your name.
• Don’t hesitate to compare insurance quotes; doing so doesn’t affect your insurance score.

Remember that maintaining a good driving record as well as a credit score of 750 or above are the most effective ways to enjoy the benefits of lower auto insurance! While it may take some effort on your part to be responsible, consider cheaper car insurance premiums a well-worth investment into your future!

Related Links to Cheap Car Insurance and Credit

-Insurance Coverage – Basics

-Cheap Car Insurance

-You Credit Score and Auto Insurance

Types of Auto Insurance Coverage

1. Property Damage Liability Coverage – This type of Insurance protects you if your vehicle causes damage to someone else’s property. Although this is most often their vehicle, it also covers structures, landscaping elements or other property.
2. Bodily Injury Liability Insurance – This coverage option covers other people’s death or bodily injury for which you are responsible. In addition, it can be used to provide legal defense if another party involved in the accident take you to court. Claims that pertain to bodily injury lawsuits include medical bills, loss of income and pain and suffering of the other involved party, not you personally. Liability Coverage is required in most states.
3. Collision Coverage- This type of Insurance Coverage is for vehicular damage caused when your automobile hits, or is hit by, another vehicle or object. It pays to repair your vehicle, less the amount of the deductible you choose. This form of auto Insurance Coverage is not necessarily required, except in cases where the vehicle is rented or leased.
4. Underinsured Motorist Bodily Injury – If the person who hits your vehicle has insufficient Insurance Coverage to provide for injuries, death or damages to your family and passengers, this insurance policy makes up the difference, up to a pre-set amount.
5. Comprehensive Coverage Insurance – This type of coverage protects your vehicle(s) and occasionally those of someone else (scenario depending) in situations other than a collision. Examples of this coverage are damage caused by flood, fire, animals or theft. While it is not required to have collision insurance, if you rent or lease a vehicle, most of these companies will require it.
6. Uninsured Motorist Bodily Injury- When you are not at fault for the accident, but the offender has insufficient Auto Insurance this coverage option will cover members of your household and passengers for injuries, damages or death caused by the other driver’s negligence. This is also used in scenarios where the other driver has no insurance.
7. Uninsured Motorist Property Damage- This insurance policy is applied in situations where the offender caused property damage and has none/minimal coverage. It typically pays up to a specific amount (varies by state) based on the policy.

Having sufficient Insurance Coverage is simply part of being a good driver. Yes, it is an expense but it is not something that you can afford to skimp on. If you are shopping for new auto insurance, do your homework carefully so that you have all the types of Insurance Coverage you need.

Related resources for Coverage of Insurance

-Definition of Auto Insurance Coverage
-Car Insurance Coverage options – AllState
-Liability Insurance covered in detail
-Coverage characteristics of auto insurance

-Is it possible to get a gap insurance coverage without purchasing the primary auto insurance coverage?

If you have purchased a gap insurance coverage, you have to purchase the minimum auto insurance coverage required by your state. According to the auto insurance laws of your state, you surely have to purchase at least bodily injury liability and property damage liability coverage. In order to take advantage of the gap insurance coverage, you have to purchase a collision and a comprehensive coverage.

-Is it possible to get a gap insurance coverage on a loan that is not specifically used for a vehicle like the Home Equity Line of Credit (HELOC)?

It is not possible for you to get gap insurance for lines of credit which you’ll utilize for other purposes than a vehicle. You cannot take advantage of the gap insurance for mortgage loans, credit lines or other types of loan payments. Suppose, if you have used money from home equity line of credit to purchase your vehicle, then gap insurance will not help you to cover this type of loan as HELOC is not specifically meant to use for auto loan.

-Is it possible to purchase a gap insurance coverage for a car if you have to take out an auto loan from a private person?

If you have taken out an auto loan from a private individual instead of a reputed financial institution such as banks or finance company, then you won’t be able to take advantage of this coverage. It’s because a private loan lacks the proper structure that any financial institute provides and is required by the insurance company to provide you the benefits of gap insurance. If you take out a loan from a private party, then it becomes tough for the insurance company to become assured of the fact that whether or not, you have taken out the loan only for the vehicle.

Thus, it’s quite essential to have proper knowledge about the above mentioned facts. This will help you take the necessary preparations avoid the mistakes before you include this special coverage in your auto insurance policy.

In regions where snow and ice are a common occurrence, it is always important to know how to arrive safely at your chosen destination. This is important to your physical well-being, but also because safe winter driving will equal better auto insurance rates. Accidents happen year round, but during times of inclement weather-especially like ice and snow- they are more common. So what safe winter driving precautions are recommended by auto insurance providers? After all, as auto insurance providers, they have a vested interest in seeing that you are a safe winter driver. Here are some winter driving tips, collected from various auto insurance companies to help you stay safe while driving this winter.

Preparations for Safe Winter Driving

1. Vehicle maintenance- Before you begin winter driving, be sure your battery is fully charged, in good operating condition and that filters, hoses, coolant, etc. are in good shape so that safe winter driving is easier.
2. Make frequent tire checks-Look for any signs of wear, changes in air pressure and perhaps add snow tires. If your tires are not in good condition, then safe winter driving is much more difficult.
3. Take a brake. Be sure your brakes, brake pads and pedal all work smoothly and efficiently. A good brake system is an important element of safe winter driving.
4. Studies show that winter tires are more effective at preventing accidents during the winter than all-season tires. Better traction means safer winter driving.

Safe Winter Driving in Action

Once you have ensured your vehicle is safe winter driving ready, you can load up and begin your assorted trips. Here are some safe winter driving habits that can help you keep you safe and auto insurance rates down.

1. Always clear the snow from your vehicles roof and windows before pulling out of your parking location to prevent causing and accident.
2. Watch for black ice. Sometimes called glare ice, this is one of the most dangerous elements of winter driving.
3. Safe winter driving also includes knowing, when or when not, to use your brakes. For example, hitting black ice is not a time to touch—especially slamming on- your brakes!
4. Safe winter driving requires an informed winter driver. Check road conditions before leaving your home.
5. Adjust your driving based on the road conditions. The safe winter driver is one who is less concerned about always being on time and more interested in arriving safely.
6. Warming up your car before driving it is not just beneficial because it means you have a warm vehicle interior, but it also helps lubricate the engine parts. Less wear and tear equals safer winter driving.
7. Be seen! For safe winter driving be sure that your headlights and taillights are bright and turned on.

Safe winter driving is more than just keeping your auto insurance rates down, it is about keeping you and others out of danger. Take the time to do these preventative maintenance suggestions and to implement these safe winter driving tips, so your winter driving memories will bring smiles to your miles.

Everywhere one goes, it seems people are talking about ways to save money. From couponing to bundling of services, many consumers are doing whatever they can to stretch their paycheck as far as possible. However, one easy way is by changing your auto insurance provider.

You have likely heard much about this option. From radio to television, magazines and the Web, auto insurance companies are vying for your business. One auto insurance provider may offer vanishing deductibles while another auto insurance provider promises to save you 15%, some auto insurance companies even offer better rates when you bundle your insured items.

However, if you are planning on purchasing more or swapping auto insurance providers, there are some great ways to save money on your auto insurance that you may not be aware of. Here are 6 ways to save money on auto insurance:

1.    When you speak to a potential auto insurance provider, be upfront about your driving history-especially, if it is one to be to brag about. For instance: What is your accident history? Do you have any points on your license? Are you a responsible driver? If you have a great record, let the auto insurance company know, as this will save you money.

2.    What is your deductible? Lower deductibles equal higher auto insurance costs. By raising your auto insurance deductible from $200 to $500, you can lower auto insurance costs by as much as 30%; raising your deductible to $1,000 can save you 40% or more. However, do keep in mind, that if you set your auto deductible higher you need to set the money aside in the event that you need to get repair work done.

3.    Do you have an older vehicle? If your car is worth less than 10 times the premium, save on your auto insurance by lowering or totally dropping the collision or comprehensive auto insurance. Of course, you will want to have money in reserve for a new(er) vehicle if this is your only means of transportation.

4.    What type of safety features does your vehicle have? Auto insurance companies typically offer lower rates on vehicles that have safety features like anti-theft devices, air bags and anti-lock brakes.

5.    Ask about available auto insurance discounts. There is no shame in asking about auto insurance discounts when you contact the auto insurance company. Some of these auto insurance discounts are being an AAA member, taking a defensive driving class or even “little” things like paperless billing or e-signatures that help auto insurance companies save on billing costs.

6.    Pay upfront. Many auto insurance providers offer lower rates if you pay quarterly, every 6 months or yearly.

Saving money on your auto insurance is a simple way to stretch your budget. With just a little bit of time invested in finding the best auto insurance company for your needs, you can soon have some breathing space in your monthly expenses. For more information on getting the most from your auto insurance, be sure to check out the other pages of our site-you’ll be glad you did!