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About Auto Insurance
A Texas auto insurance policy pays only for damages,
injuries and other losses - such as theft -
specifically covered by the policy. Some coverages -
such as liability insurance - are required, while
others are purely optional.
Frequently Asked Questions about Car Insurance:
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. Return to Top 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. Return to Top 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. Return to Top 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 Return to Top 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. Return to Top 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. Return to Top 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. Return to Top Will my auto policy pay for flood damage? Yes, if you have comprehensive, other than collision, coverage for your car. Return to Top 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. Return to Top 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. Return to Top 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. Return to Top 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. Return to Top 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. Return to Top Do I need to buy special coverage when renting a car in Texas? Auto rental agencies offer collision damage waivers that 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. Return to Top What do the coverages listed on my policy actually do? Depending on the types of coverage you have, automobile insurance pays for car repair or replacement, medical expenses, rental cars, towing, court costs, and other expenses. Many insurance companies use the Texas Personal Automobile Policy, a standardized policy form that offers eight types of coverages. Companies may sell other policies if the Texas Department of Insurance (TDI) has approved the policies... Read your policy carefully because coverages can vary. Pay special attention to the exclusions section, which lists the things your policy doesn’t cover. The front page of your policy – called the declarations, or dec, page – shows the exact name of your insurance company, your policy number, and the amount of each of your coverages and deductibles. Following is a summary of the eight coverages in the Texas Personal Automobile Policy. Although your coverages and policy terms may be different from these, this summary can help you understand the coverages. You select and pay for each coverage you want. They are: Return to Top Liability Coverage (Basic liability coverage meets the state’s financial responsibility requirement.) Pays: Other people's expenses for accidents caused by drivers covered under your policy. This is the only auto insurance required by Texas law. The insurance company will pay amounts for which you are legally responsible, up to your policy's dollar limits. These may include the other party's: 1. Medical and funeral costs, lost wages, and compensation for pain and suffering br> 2. Car repair or replacement costs 2. Car rental while the other driver’s car is being repaired. 3. Punitive damages awarded by a court. Liability insurance also pays your attorney fees if someone sues you because of the accident. If you are arrested following an accident, liability insurance will pay up to $250 for bail. Covers: 1. You and your family members. (Family members include anyone living in your home related to you by blood, marriage, or adoption. This includes your spouse, children, in-laws, adopted children, wards, and foster children.) 2. Other people driving your car with your permission. 3. Family members attending school away from home. 4. Spouses living elsewhere during a martial separation might be covered. You and your family members might be covered when driving someone else’s car – including a rental car – but not a car that you don’t own but have regular access to, such as a company car. Return to Top Medical Payments... Pays: Medical and/or funeral bills arising from motor vehicle accidents, including those in which the victim was a pedestrian or a bicyclist. Covers: You, your family members and passengers in your car, regardless of who caused the accident. You can't collect from both your medical payments and your uninsured motorist/underinsured motorist coverages for the same medical bills. NOTE -- If your policy includes Medical Payments or PIP, your insurer is required to pay a supplemental death benefit of up to $10,000 to survivors of any covered person killed in a car accident while buckled up or protected by an airbag. To collect, a beneficiary must provide proof of death and a police report or other evidence that the victim was protected by an airbag or seatbelt. Return to Top Personal Injury Protection (PIP)... Pays: Same as Medical Payments, plus: 1. 80 percent of lost income. 2. The cost of hiring someone to take on the household and caregiver responsibilities of an injured person. Covers: Same people as Medical Payments. A company must offer you $2,500 in PIP, but you can buy more. If you don't want PIP, you must reject it in writing. Return to Top Uninsured/Underinsured Motorist...(UM/UIM) Pays: Your losses from an accident caused by a hit-and- run driver or an uninsured motorist, up to your policy's dollar limits. Also pays if the other driver did not have enough insurance to cover all your expenses. 1. Bodily injury UM/UIM pays without deductibles for medical bills, lost wages, pain and suffering, disfigurement and permanent or partial disability. 2. Property damage UM/UIM pays for auto repairs, a rental car and damage to items carried in your car. There is an automatic $250 "deductible" - an amount you pay from your own pocket. NOTE -- Your UM/UIM insurance pays for a hit-and-run accident only if you promptly report it to the police. Covers: You, your family members, passengers in your car and anybody driving with your permission. Insurers must offer UM/UIM coverage, but you can reject it in writing. Return to Top Collision (Damage to Your Car)... Pays: Cost of fixing or replacing your car after an accident - regardless of who was driving or who was to blame. Payment is limited to your car's actual cash value, minus your deductible. "Actual cash value" is the retail price of a car like yours before it was damaged. You should consider dropping this coverage if you have an older car that is paid for. Return to Top Comprehensive (Physical Damage Other than Collision)... Pays: To replace or fix your car if it is stolen or if it is damaged by causes other than a collision, such as fire, vandalism or hail. Also pays for a rent car or other temporary transportation if your car is stolen. Coverage Limit: Your car's actual cash value, minus your deductible. Return to Top Towing & Labor... Pays: Towing charges when your car is disabled. Also pays labor charges, such as changing a tire, at the place where your car is disabled. Return to Top Rental Reimbursement... Pays: A set daily amount for a rental car if your car is stolen or is being fixed because of damage covered by your auto policy. CAUTION -- Your policy won't pay for auto theft unless you report it to the police. insruance If you have any questions that have not been answered by this site, please contact us anytime and we'd be happy to discuss your insurance needs in more detail! Return to Top "Expert Advice on How To Save Money On Car Insurance" |
Austin Insurance Group Austin - Cedar Park (and all Texas Counties) 512-339-2901 email: aig@texas.net 
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