Understanding the State-Mandated Minimum Auto Liability Insurance
It has been estimated that as many as 15% of all drivers on the road in the United States do not have liability insurance for their vehicle. Of course, that estimation does not take into account drivers in New Hampshire and Wisconsin, who in previous years were not required by the state government to carry liability insurance on their personal vehicles.
Beginning June 1, 2010, drivers in Wisconsin will be required by the state to carry liability insurance protection for their vehicles. That will leave New Hampshire as the only state that does not require motorists to carry automotive liability insurance.
Yet, there were more than 6 million recorded traffic accidents in the United States in 2009 – roughly equal to one accident for every 50 people living and working in the United States.
According to statistics produced by the National Highway Traffic Safety Administration, there were nearly 34,000 traffic fatalities on American roadways during 2009.
Despite these grim odds, most people who purchase auto insurance for their personal vehicles will only purchase the state-mandated minimum liability insurance protection, with the minimum-coverage required by the state.
What most people do not realize is that the minimum state requirements for liability insurance could very well fall short of what is required to pay the medical expenses and property damage of the other party.
Additionally, most people do not realize that if the insurance company fails to cover all of the required medical expenses and property damages, then the injured party can sue you for the difference, if you were at fault.
In a state of Wyoming, the minimum state requirements for liability insurance are 25/50/20. The first two numbers, the 25/50, referred to bodily injury liability limits, and the third number refers to the property damage liability limit.
What this actually means to the consumer is that the state mandated liability requirements will cover up to $25,000 per individual injured in a traffic accident and up to $50,000 for everyone involved in the accident, who needed medical treatment.
The third number, in the case of Wyoming’s minimum state requirements for automotive liability insurance, indicates that the insurance company will only be liable up to $20,000 for any property damage related to a motor vehicle accident that was the fault of their client.
If you consider the cost of medical care in the United States today, Wyoming’s minimum liability insurance requirements for medical coverage may not fully protect your personal finances, in a worst-case scenario traffic accident.
Additionally, when new cars frequently cost more than $25,000 to purchase, as is the case today, then Wyoming’s minimum requirement of $20,000 coverage for property damage could very well fall terribly short of what is required to repair or replace the other person’s vehicle or other property.
If you were to buy the minimum auto liability insurance, as required by the state of Wyoming, you could be leaving yourself with inadequate liability insurance coverage and financial protection.
Many consumer advocates recommend a minimum of 100/300 for bodily injury protection to ensure that you will be financially protected in the event of an auto accident. Advocates also recommend a minimum of $50,000 for property damage, in the event that an accident is your fault.
The smallest amount required by any state for medical liability is 10/20/10 liability coverage, available to residents of Florida.
The state with the highest liability insurance coverage requirements are Wisconsin, which is just introducing mandatory automotive liability insurance and is entering the fray with the highest minimum liability protection in the United States at 50/100/55. Behind Wisconsin is Alaska and Maine, which both require a minimum of 50/100/25.
The state-required minimums for automotive liability insurance give a false impression, concerning how much risk an individual is actually taking on, when they get behind the wheel of the car.
Liability insurance is often the smallest portion of our total automotive insurance premium. Getting additional liability insurance is usually pretty inexpensive. But given the high cost of medical expenses and vehicle replacement, it may be in your best interest to spend a few more dollars to get some additional liability insurance protection.
While it may be possible to reduce your insurance rates by reducing your liability coverage, it is not recommended that you to do so. For most people, it may actually make far more sense to increase liability coverage, rather than to reduce liability coverage.
To see the minimum required coverage amounts of liability insurance protection for drivers around the country, see our list of the minimum liability requirements for all 50 states here: http://CheapOklahomaAutoInsurance.com/understanding-liability-insurance.php
About The Author:
For those who are looking to save money on auto insurance, the best advice is to get several quotes from as many insurance carriers as possible, since automotive insurance policy pricing can vary by as much as several hundred dollars from company to company. Oklahoma drivers can compare auto insurance quotes at http://CheapOklahomaAutoInsurance.com/ Drivers from other states can use http://maxroo.com/updates/auto-insurance-quotes/ to get at least four quotes from local insurance agents. Written by Quinton Becker.
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