Texas Car Insurance FAQs



Texas Car Insurance FAQS - About Auto Insurance
Find out how Texas Car Insurance FAQs can help you make better choices in your auto insurance coverages. Frequently asked questions about Car Insurance in TX.

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Texas Car Insurance FAQs

What meets TX insurance requirements?

If you buy insurance to meet the Texas state’s financial responsibility law, you must purchase at least the minimum amount. The current minimum liability limits are $30,000 for each injured person, up to a total of $60,000 per accident, and $25,000 for property damage per accident. This basic coverage is called 30/60/25 coverage.

Because of car prices and the high cost of medical care, the minimum amounts might not be enough to pay all of the other driver’s costs if you’re in an accident. Other drivers could sue you to collect the difference. Consider purchasing more than the basic limits to protect yourself financially.

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How do I prove I have insurance?

Your insurance company will send you a proof-of-insurance card listing the covered cars and drivers and showing the policy number and expiration date.  Your policy or a temporary binder is also acceptable evidence of insurance.

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When must I show proof of insurance?

Proof of financial responsibility must be shown when you:
1. Are asked for it by a law enforcement officer.
2. Have an accident.
3. Register your car or renew its plates.
4. Obtain or renew a driver’s license.
5. Get your car inspected.

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What are the penalties for driving without insurance?

Texas law provides severe penalties for violating financial responsibility laws:
1. First Offense: $175 to $350 fine.
2. More Offenses: $350 to $1,000 fine, driver’s license suspension and impoundment of your vehicle.
3. Offense without a driver’s license: $2,000 maximum fine, 180 days in jail, or both.
4. Offense if you cause an accident with serious injuries or death: $4,000 maximum fine, one year in jail, or both.

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Do I need more than Texas’ minimum liability insurance when I drive in other states?

No.  Your Texas policy automatically meets the requirements of other states and Canada.

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Can I get liability insurance for nonowners if I don’t have a car?

Yes.  You can buy a non-owner liability policy.  It pays for damages and injuries you cause when driving a borrowed or rented car but not for damage to the auto you are driving.

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Is my policy good in Mexico?

No, with a possible minor exception.  Mexico does not recognize U.S.  auto liability policies.  You can buy Mexican liability insurance and Mexico insurance from Texas agents who specialize in it.
The minor exception:  Some U.S. companies provide a free endorsement extending your policy’s coverage to infrequent trips of up to 10 days and as far as 25 miles into Mexico.  You can buy coverage for longer stays, but it still ends 25 miles from the border. Check your policy if you live in or frequently travel to the Texas-Mexico border area.

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Will my auto policy pay for flood damage?

Yes, if you have comprehensive, other than collision, coverage for your car.

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Does my policy cover equipment such as cellular phones?

The Personal Auto Policy won’t pay for tapes, compact discs, cellular phones or citizen band radios or for stereo equipment, not permanently installed in your car, unless you pay extra for separate coverage.

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Do I have to buy collision and comprehensive coverage?

Liability insurance does not pay to repair or replace your car or to treat your injuries. Consider purchasing other types of coverage – such as medical payments, collision, and comprehensive – to pay for these expenses.
Texas law does not mandate this, but lenders usually require collision and comprehensive on cars they are financing.

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When I buy a car, does my policy automatically cover it?

Yes, but you need to be aware of certain limitations.  An additional car automatically has the same coverage as the car with the broadest coverage provided by your policy.  (EXAMPLE:  You already have two cars.  One has just liability coverage.  The other has liability, collision and comprehensive – the broadest coverage afforded by the policy.  Therefore, if you buy a third car, it automatically will have liability, collision and comprehensive.)

A replacement car automatically has the same coverage as the car it replaced.  (EXAMPLE:  You have two cars.  You trade in the older car, which has only liability automobile insurance coverage, on a new car.   This means the new car automatically has only liability coverage.)

Be sure to notify your company as soon as possible that you have added or replaced a car and which coverages you want for the new car.  You could lose coverage on the new car if you wait  longer than 30 days.

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What if I drop collision and comprehensive on my financed car?

Don’t.  The lender will buy single-interest automobile physical damage coverage.  It is expensive and protects only the lender, who will add the premium to your note.  You may drop collision and comprehensive once a car no longer is financed.

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What family members are covered by my personal auto policy?

Spouse, blood relatives, in-laws, adopted children, wards and foster children living in your home – even if not named on the policy.  Also covered are family members attending school away from home.

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Do I need to buy special coverage when renting a car in Texas?

Auto rental agencies offer collision damage waiversthat pay if you damage a rental car.  You might not need this extra expense because your auto liability policy already covers such damage.  Remember, however, that your liability policy only pays up to its dollar limit.  This might be  less than the value of a rental car.  If you rent cars often, it is  cheaper to raise your liability limit than to buy collision damage  waivers.

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Texas Car Insurance FAQs

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