Car insurance laws are designed to insure that every individual has appropriate insurance coverage to protect himself and others in the event of an accident. Car insurance laws exist so that if you cause an accident, the victim (or society) will not end up bearing the financial burden of that accident.
What Are Car Insurance Laws
Every state in the United States is entitled to make its own car insurance laws. These laws vary by jurisdiction, but there are some commonalities, always be aware about the cheapest auto insurance quotes. For example:
- You cannot register or purchase a car without car insurance on the vehicle: If you buy a new or used car, before you drive it off the lot, you must call your car insurer and get an insurance policy on the car. The same is true if you go to the DMV to register (or re-register) your car. You must show proof of insurance
- You are legally required to have a state-mandated minimum of liability protection: These numbers vary by state. For example, California has a 15/30/5 minimum liability ratio. Indiana, on the other hand, has a Indiana 25/50/10 requirement. The first two numbers relate to the amount of injury liability protection you need, while the second relates to protection from property damage liability. This means that, in California, a driver is required to have a minimum of $15,000 in bodily injury protection for each individual. They are required to have at least $30,000 in liability protection per incident. In other words, if you get into a car accident in California and there are 3 people injured, your insurer will pay up to $15,000 for each individual person. However, they will only pay $30,000 total for the whole accident. So if each of the 3 people has $10,000 in injury, insurance will fully cover the accident. However, if one person has $29,000 in liability and the other 2 have $500 in injury each, the insurer will pay $15,000 to the first person and $500 to each of the other two. In Indiana, however, you are required to have $25,000 of protection for each individual and $50,00 per incident. The third number refers to the amount of property damage your policy will cover.
- You are required to have proof of insurance: If a police officer pulls you over you must have your insurance card in the car and display your card. This rule is primarily designed to insure that no one drives a vehicle without the state-mandated minimum of liability protection.
Penalties for Violating Car Insurance Laws
The penalties for violating car insurance laws vary by state and the type of offense so you have to be careful about how these quotes are calculated. You may have your car impounded and/or face fines. You may also be subject to jail time if you do not have adequate insurance. In addition, if you have an accident and hurt someone else or damage their property, you will need to pay the entire cost out of pocket. Car insurance laws are thus designed to protect you from financial disaster, and to protect society as a whole from uninsured drivers.
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