No cookie cutter laws when it comes to mandatory and optional auto insurance coverages in America
Whether a driver is an experienced NASCAR driver or part of a Florida GDL program, American motorists are required to drive with mandatory insurance coverage.
Also referred to as liability car coverage, mandatory auto insurance covers motorists from any damage they cause to another motorist or property in an at-fault car wreck.
Mandatory insurance coverage is well…mandatory … in almost all the Nation with the exception of the state of New Hampshire which truly adheres to its state motto of “Live Free or Die.” For the other 49 states though, the minimum required is set by each state’s government and breaks down into three coverage parts rolled into one: coverage for bodily injury for each injured driver, coverage for bodily injury for each car wreck and property damage.
For instance, in Texas the minimum state coverage requirements for mandatory auto insurance are 30/60/25 and that’s also exactly how they’ll appear on an insurance ID card. The numbers mean that a driver and anyone else listed on the policy are protected for
- $30,000 – Bodily injury, each individual;
- $60,000 – Bodily injury, each accident;
- $25,000 – Property Damage.
The coverage amounts also represent the maximum amount that is payable to the injured parties not the policy holder. And the bodily injury component of mandatory insurance coverage covers a wide range of expenses. From defense lawyers to the injured driver’s loss of money if they can’t work, the injured driver’s medical expenses, pain and suffering and even internment costs.
The property damage component of mandatory auto insurance helps the insured driver by paying for the damaged done to the injured party’s car or other property like a home.
All three are rolled into the mandatory insurance coverage and cannot typically be purchased solo however mandatory auto insurance doesn’t always consist of those three components. In fact in some cases what is mandatory in one state is optional in another. For example, in the state of Florida bodily injury liability is optional and not part of mandatory insurance coverage. Property damage liability and Personal Injury Protection make up the Sunshine State’s mandatory requirements for car insurance coverage.
Sometimes though a state’s mandatory insurance coverage includes all three components of liability plus coverage that is typically optional elsewhere. For instance South Dakota’s mandatory auto insurance includes full liability coverage plus Uninsured/ Underinsured motorist bodily injury, which covers policy holder’s when the other driver is at-fault but doesn’t have enough or any car insurance at all.
Drivers moving to a different state would be wise to know before they move what is considered mandatory insurance coverage in their new home state.
Other types of optional car coverage include:
- Personal Injury Protection (PIP) – Pays for an injured policy holder’s medical bills regardless of fault; passengers are also typically covered. Also pays for loss of income and other related expenses such as child care. Internment expenses may also be covered under PIP which is optional in states that aren’t no-fault.
- Medical Payments Coverage – In a car wreck, this optional coverage pays for accident-related hospital and funeral bills.
- Collision Coverage – Policy holders are covered for damages to their vehicle when they wreck into another car or object with this mostly optional coverage. Collision is part of mandatory insurance coverage when a vehicle is financed or leased.
- Comprehensive Coverage – Like collision, this coverage is mostly optional and typically only part of mandatory car coverage when the vehicle is leased or financed. Damage from a tornado, hail wind, vandalism or theft is the type of damages covered through comprehensive.
- Uninsured/ Underinsured Driver Coverage – Mostly optional protection that covers damaged caused by an uninsured motorist or one with a low amount of coverage. Part of mandatory insurance coverage in some states.
- Rental Coverage – Pays the cost of a rental after a covered driver’s vehicle can’t be driven after an accident. Coverage is not part of mandatory car coverage in any state.
- Emergency Road Assistance – Covered drivers don’t pay for towing if their car breaks down from mechanical breakdown with this optional coverage. Like Car Rental Coverage, never part of any mandatory car coverage.