All Texas motorists should carry automobile insurance. Since 1981, it
has been the law in Texas that all motorists must carry automobile
liability insurance. Effective September 1, 1991, the enforcement provisions of
the mandatory insurance law were strengthened.
Texas motorists must now show proof of liability insurance to receive or renew a
driver's license, receive a safety inspection sticker or register a vehicle. The
fine for not having insurance has increased from $75 under the old law to
between $175 and $350 under the new law. A second offense could mean impoundment
of your vehicle and suspension of your driver's license.
Some people may be confused about the various types of automobile insurance
available in Texas, the purpose of each type of insurance, and the costs related
to that insurance coverage. The basic types of automobile insurance are:
Liability coverage
This coverage protects you if you drive negligently and cause injury to another
person or damage to another vehicle. Texas law requires every automobile owner
to carry liability insurance in the minimum amount of $20,000 per person
injured. It is usually wise, and normally not much more expensive, to carry more
insurance than the minimum limit. If you do not have enough insurance to pay for
the damage or injuries you cause, you could be personally responsible for the
additional cost of the damage or injuries.
Personal Injury Protection coverage
This is a form of "no-fault" insurance coverage that pays medical
bills and lost earnings for you and others in your car, no matter who was at
fault in the collision. PIP is available in different amounts, and $10,000 worth
of coverage is generally not much more expensive than $2500 in coverage. PIP
coverage pays benefits if any member of your family is injured in any
automobile, and if any person is injured in your automobile. It is a very
worthwhile addition to your basic automobile insurance policy.
Uninsured and Underinsured Motorist coverage
This coverage will pay for property damage or injuries sustained by you, your
family members or occupants of your automobile and caused by drivers who have no
liability insurance, or insufficient liability insurance, of their own. In other
words, this coverage replaces the other driver's liability insurance. This
coverage is optional, but highly recommended. Without it, you will have no
protection if you are involved in a collision with an uninsured driver.
Collision coverage
This pays for property damage to your car if it is involved in a collision, no
matter who was at fault in the collision. This insurance will pay for your
property damage even if the collision was your own fault. There is a
"deductible" amount that you must pay, and your insurance company will
pay the remainder.
Comprehensive coverage
This coverage pays for loss or damage to your automobile or its contents in
situations not involving collisions. For instance, this insurance applies in
cases of hail damage, fire, theft or flood. The question of fault does not apply
to comprehensive coverage, but there is a "deductible" amount you must
pay.
Automobile insurance rates vary widely depending on the insurance company or
agent you choose, the types and amounts of coverage you want, and the kind of
car you drive. Our law firm has prepared a brochure that further explains
automobile insurance and offers tips on lowering the cost of your insurance. It
is available on our Web site or you can call us for a printed version of this free
brochure.
