You must confirm to auto insurance requirements in Texas to drive any vehicle in this state. According to Texas law, if you own a vehicle, you should be able to prove that you can cover any damages caused by an accident that is your fault. This is known as proof of financial responsibility.
Proof of financial responsibility can be demonstrated in three ways:
- Making a deposit of $55,000 with comptroller of Texas
- By a surety bond, where the insurance is backed by real estate
- Purchasing an auto insurance policy that confirms to the minimum requirements of Texas
Minimum Auto Insurance Requirements in Texas
Liability insurance is mandatory for any auto insurance in Texas. At present, the required minimum is referred to as 30/60/25 coverage. This means the liability is limited to $30,000 per injured individual, to a maximum of $60,000 in one accident, and $25,000 for damages to property.
However, this is the minimum mandatory coverage and it will not cover replacement or repairs for your vehicle, or medical costs for personal injuries. Secondly, because of rising medical and vehicle costs, the mandatory coverage may not be adequate to cover all costs of third parties in an accident. In such a case, you might be sued, and a court might order you to pay the difference. Due to all these reasons, it is advisable to buy more insurance than the minimum requirement, and take a more comprehensive coverage that will take care of your medical expenses and vehicle damages.
Types of Auto Insurance Coverage in Texas
Apart from the minimum auto insurance requirements in Texas discussed above, there are other types of coverage available in Texas that will cover more items.
- Collision Coverage: This is quite an important addition to the minimum auto insurance requirements in Texas. This will cover the cost of repairs or replacement of your vehicle after the accident. You will get the market value of your vehicle minus deductibles.
- Comprehensive Coverage: This covers contingencies other than collision, and includes repairs or replacement of your car in case of theft, vandalism, fire, falling objects and hail. Such a policy will also cover rental vehicle or temporary transportations, in the event of theft of your vehicle. In case of auto theft, the incident must be reported to the police to make a claim.
- Medical Payments Coverage: This policy will cover you, members of your family, and car passengers, irrespective of who is responsible for the accident. The coverage will pay for medical expenses and funeral bills. It also includes accidents that involve bicyclist or pedestrian.
- PIP (Personal Injury Protection) Coverage: This is more comprehensive than coverage of Medical Payments, as it gives an additional 80% for income loss, and expenses to hire caregiver for the injured. The minimum PIP offered by an insurance provider cannot be less than $2,500; however, you can opt for more.
- UM/UIM (Uninsured/Underinsured) Motorist Coverage: This would cover expenses in an accident, which is caused by hit-and-run motorist, underinsured driver or uninsured driver. It also pays for damages to personal property in your vehicle. The mandatory deductible for this coverage is $250.
Need more information on very cheap Texas vehicle insurance? Please visit Texas Department of Insurance online at www.tdi.texas.gov.
Texas Department of Insurance
333 Guadalupe, Austin 78701
P.O. Box 149104, Austin 78714
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