Frequently Asked Questions

What insurance is required by Texas Law to drive a car?

Texas law requires people who drive in Texas to be able to pay for the accidents they cause. Most drivers do this by buying automobile liability insurance. Liability insurance pays to repair or replace the other driver’s car and pays other people’s medical expenses. It does not pay to repair or replace your car or for your injuries.

You must have at least the minimum amount of liability coverage required by the state’s financial responsibility law. The current minimum liability limits are $25,000 for each injured person, up to a total of $50,000 per accident, and $25,000 for property damage per accident. This basic coverage is called “25/50/25” coverage. The limits will increase on January 1, 2011, to $30,000 for each injured person, up to a total of $60,000 per accident, and $25,000 for property damage per accident.

Because of car prices and the high cost of medical care, the minimum amounts might not be enough if you cause an accident. If your liability limits are too low to pay for all of the other driver’s costs, the driver may sue you to collect the difference. To protect yourself financially, consider buying more than the basic limits.

When will I have to show proof of insurance?

When you buy an auto policy, your insurance company will send you a proof-of-insurance card. You will need to show proof of insurance when you

• are asked for it by a law enforcement officer
• have an accident
• register your car or renew its registration
• obtain or renew your driver’s license
• get your car inspected.

There are penalties for violating the state’s financial responsibility laws. A first conviction will result in a fine between $175 and $350. Subsequent convictions could result in fines of $350 to $1,000, suspension of your driver’s license, and impoundment of your automobile.

The penalties for violating the state’s financial responsibility laws increase if you don’t have a valid driver’s license to a fine not to exceed $2,000, 180 days in jail, or both. The penalty increases to a fine not to exceed $4,000, one year in jail, or both if you case a car accident that results in serious injury or death.

What does Liablity Insurance pay for?

• medical and funeral costs, lost wages, and compensation for pain and suffering
• car repair or replacement costs
• auto rental while the other driver’s car is being repaired
• punitive damages awarded by a court.

Liability insurance also pays your attorney fees if someone sues you because of the accident and  bail up to $250 if you are arrested.

Note: Some policies won’t cover other people, including family members, unless they’re  specifically named in the policy. Your policy’s dec page should list the names of all of the people covered by the policy.

What is Medical Payments coverage?

What is Personal Injury Protection (PIP) Coverage?

What is Uninsured/Underinsured Motorist (UM/UIM) Coverage?

Pays: Your expenses from an accident caused by an uninsured motorist or a motorist who did not  have enough insurance to cover your bills, up to your policy’s dollar limits. Also pays for  accidents caused by a hit-and-run driver if you reported the accident promptly to police.

• Bodily injury UM/UIM pays without deductibles for medical bills, lost wages, pain and suffering, disfigurement, and permanent or partial disability.
• Property damage UM/UIM pays for auto repairs, a rental car, and damage to items in your car. There is an automatic $250 deductible, which means you must pay the first $250 of the repairs yourself.

Covers: You, your family members, passengers in your car, and others driving your car with your  permission.

Insurers must offer UM/UIM coverage. If you don’t want it, you must reject it in writing.

What is Collision (Damage to Your Car) Coverage?

Pays: The cost of repairing or replacing your car after an accident. Payment is limited to your  car’s actual cash value, minus your deductible. Actual cash value is the market value of a car  like yours without damages.

Covers: You, your family members, passengers in your car, and others driving your car with your  permission.

What is Comprehensive (Physical Damage Other than Collision) Coverage?

Pays: The cost of replacing or repairing your car if it is stolen or damaged by fire, vandalism, hail,  or a cause other than a collision. Comprehensive coverage also pays for a rental car or other  temporary transportation if your car is stolen. Your policy won’t pay for an auto theft unless you  report it to police. Payment is limited to your car’s actual cash value, minus your deductible.

If you still owe money on your car, your lender will require you to have collision and  comprehensive coverage.

What is Towing and Labor Coverage?

What is Rental Reimbursement Coverage?

Do I need to purchase the Collision Damage Waiver if I rent a car?

If you have auto insurance, your policy may already cover damage to a rental car. Your coverage limit, however, might be less than the value of a rental car. Read your policy to know what’s covered and the coverage limits. If your coverage limit is too low, consider increasing it. You will pay more in premium, but it might be cheaper than buying additional coverage through the rental agency, especially if you rent cars often.

If you don’t own a car, but borrow or rent cars often, you can buy a non-owner liability policy. A non-owner policy pays for damages and injuries you cause when driving a borrowed or rented car, but it does not pay for your injuries or damage to the car you were driving.

Do I need to purchase additional insurance if I drive to another state, Canada or Mexico?

A Texas automobile insurance policy usually meets the financial responsibility requirements of other U.S. states and Canada. Mexico, however, does not recognize U.S. auto liability policies.

Mexican authorities can hold drivers criminally and financially responsible for any auto accidents they cause. If you’re in an accident that results in an injury, police may detain you until they determine who is at fault. You will have to show that you either have insurance recognized by the Mexican government or the financial ability to pay any judgment against you.

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 is usually valid only within 25 miles of the border. In addition, these endorsements might not meet Mexican legal requirements.

You can buy Mexican liability insurance from Texas agents who specialize in it. Call Insurance Plus Agencies at 866-466-1699 to get a quote today.

You may be able to buy a Mexico “tourist” endorsement for your U.S. policy. This endorsement extends your liability coverage to pay costs exceeding a Mexican liability policy’s limits. It covers trips of any distance and any length of time.

Can I add my child to my policy?

Parents can usually add their young drivers  to their auto policy to satisfy the state’s financial responsibility requirements. Adding a young driver to a parents’ policy can be expensive, but it’s cheaper than buying a separate auto policy.

Some policies require all drivers to be named on the policy for coverage to apply. Therefore, it’s important that you list all family members on the policy as soon as they reach driving age. If you don’t have all of the drivers in your family listed on your policy and the company learns about them later – because of an accident claim, for instance – the company will bill you for the extra premium you should have paid and could deny your claim and coverage.

If you have children attending school away from home, tell your insurance company. Companies base rates on where a car is usually located, and it might need to adjust your premium. If the school is in another state, check on the financial responsibility laws in that state to make sure you have the appropriate coverages.

Generally, if a teenager is the principal driver of a particular automobile, the company will base the teen’s rate on that car. Otherwise, the company will assign the teenage driver to the car (usually the most expensive) in your household that produces the highest rate.

When can I remove my child from my policy?

You may want to remove your children from your policy when they move out. You’ll probably have to prove to the insurance company that your child has moved. You can use documents like a driver’s license, lease agreement, or utility receipts to show that your child has a separate address.

It’s probably not a good idea to remove children from your policy if they are attending school away from home. It’s risky to drop coverage if your teenager might occasionally drive at school or when home on visits. Many insurance companies will require you to keep students on your policy, even if you would like to remove them.

What information is used to determine my insurance rate?

Before writing or renewing a policy, insurance companies determine your risk for an accident by checking motor vehicle records for your driving history.  Some companies might also review your credit history.

Many companies use the Comprehensive Loss Underwriting Exchange (CLUE) to learn an applicant’s insurance claims history. If the company used a CLUE report to deny, cancel, or nonrenew your policy, you can get a free copy by calling the ChoicePoint Consumer Center or by visiting the ChoicePoint website

 1-800-456-6004
 www.choicetrust.com/index2.htm

Before calling, get the CLUE reference number from the insurance company. Using the reference number will speed the process and ensure that you request the right report.

What should I do after an accident?

• If possible, move your car to avoid blocking traffic and to protect it from further damage.
• Call the police if somebody is injured or killed, if you can’t move your car, or if the accident involved a hit-and-run driver. Your uninsured motorist coverage pays for a hit-and-run accident only if you report it to police.
• Get the following information from the other driver:
  • name
  • address
  • telephone number
  • license plate number
  • license number
  • insurance company name (get the exact and full name)*
  • insurance policy number
• Give the other driver the same information about you.
• Get the names, addresses, and telephone numbers of any witnesses to the accident.
• Notify your insurance company as soon as possible. Your company probably has a 1-800 number to report claims. If not, call your agent. The agent or company will explain the claims process, including how to schedule an adjuster and get repair estimates. Also, give your agent or company the names and addresses of any witnesses and anyone injured.
• If you reported your claim by phone, follow up in writing as soon as possible to protect your rights under Texas’ prompt payment of claims laws.
• Send the company copies of the accident report and any legal papers you receive about the accident.
• Cooperate with the company’s investigation. You might have to submit a proof-of-loss form or have a medical examination.

* If the other driver refuses to tell you the name of his or her insurance company, get a copy of the police accident report. The accident report should list the other driver’s name and insurance company. If the police did not investigate the accident, you can report the driver’s refusal to police. This could result in a report identifying the driver’s insurance company. In addition, the Texas Department of Public Safety keeps files of forms – called SR-22s – that show the insurance companies of people convicted of DWI or driving without insurance. Call the DPS Customer Service Bureau

512-424-2600

If I'm in an accident and it's the other person's fault, what should I do?

If you were in an accident caused by another driver, the other driver’s insurance company should pay the following costs, up to the policy’s limits:

• repair or replacement of your car
• car rental while your automobile is being repaired
• your medical and hospital bills
• wages lost because of an injury
• compensation for pain and suffering if anyone is hurt.

If the other driver’s insurance won’t cover all your medical bills, file a claim for the difference against your Personal Injury Protection (PIP) coverage, if you have it. For amounts greater than that, you can claim against your uninsured/underinsured motorists (UM/UIM) coverage or your health insurance policy.

If the other driver’s policy won’t cover all of your auto repairs, file a claim against your collision or UM/UIM coverage for the difference (minus your deductible) between the damage to your car and what the other driver’s policy will pay.

What are the rules regarding Low-Speed and Neighborhood Electric Vehicles?

A vehicle is classified as an LSV or NEV if it has:

• a normal maximum speed of 20-25 mph (LSV) or 20-35 mph (NEV),
• seat belts,
• head and tail lights,
• a windshield,
• a parking brake,
• turn signals,
• rear-view mirrors
• brake lights,
• reflectors, and
• a valid 17-digit Vehicle Identification Number (VIN)

To title and register your LSV or NEV, take the following to your county tax office:

• evidence of ownership, such as a Manufacturer Certificate of Origin or title,
• a completed Form VTR 130-U, and
• proof of insurance.

What are the rules regarding golf carts?

A vehicle is classified as a golf cart if it:

• has no less than three wheels,
• has a normal maximum speed of between 15-25 mph, and
• is manufactured primarily for operation on golf courses.

TxDMV does not register or title golf carts.

Registration is not needed to operate your golf cart on a public road. State law allows for use of golf carts with a slow-moving vehicle emblem in the following situations:

• in master planned communities with a uniform set of restrictive covenants in place,
• on public or private beaches,
• during the daytime and no more than two miles from where the owner usually parks the golf cart and for transportation to or from a golf course, or
• to cross intersections, including a road or street that has a posted speed limit of more than 35 miles per hour.

A city can pass a local ordinance allowing for use of golf carts on additional roads. The road must be within the boundaries of the city and with a speed limit of 35 mph or lower.

In these cases, the golf cart must be insured and have the following minimum equipment:

• headlamps,
• tail lamps,
• reflectors,
• parking brake,
• mirrors, and
• a slow-moving vehicle emblem.

The state, a county, or a city may prohibit golf cart operation on all or part of a public road in the interest of safety.

Note: An exception for Grayson County allows for the issuance of Golf Cart License Plates. Grayson County golf cart owners must take the following to their county tax office to purchase golf cart license plates:

• Evidence of ownership, such as a Manufacturer Certificate of Origin (MCO), title, bill of sale or invoice.
• If your golf cart does not have a valid VIN, one may be assigned from the Dallas regional VTR office.
• Completed Form VTR 130-U.

What are the rules regarding All-Terrain Vehicles?

What are the rules regarding Utility Type Vehicles or Recreational Off-Highway Vehicles?

What is the Motorcycle helmet law in Texas?

Motorcycle Helmet Exemptions

On June 19, 2009, Governor Rick Perry signed into law
Senate Bill 1967 of the 81st Regular Legislative Session.
This law became effective September 1, 2009 and
repealed the helmet exemption sticker program.

• Former law required a person be covered with a minimum of $10,000 in health insurance for injuries incurred in a motorcycle accident to be eligible for an exception for the offense of operating or riding a motorcycle without a helmet. The law removes that minimum amount. The law requires the Texas Department of Insurance to prescribe a standard proof of health insurance for issuance to persons who are at least 21 years of age and covered by an applicable health insurance plan. "Health insurance plan" means an individual, group, blanket, or franchise insurance policy, insurance agreement, evidence of coverage, group hospital services contract, health maintenance organization membership, or employee benefit plan that provides benefits for health care services or for medical or surgical expenses incurred as a result of an accident.
• The law prohibits a peace officer from stopping or detaining a person who is the operator of or a passenger on a motorcycle for the sole purpose of determining whether the person has successfully completed a motorcycle operator training and safety course or is covered by a motorcycle health insurance plan and repeals provisions relating to a DPS-issued sticker required to be displayed on a motorcycle by a motorcycle owner.

What is Progressive Insurance Pet Injury Coverage?

Is boat insurance required in Texas?

When is boat insurance required by Texas law?

What is an SR22?

Why do I need an SR22?

How do I get an SR22?

How long will I need to keep my SR22?

What happens when I no longer need my SR22?

If I do not own a car, how can I get an SR22?

How long is proof of financial responsibility (SR-22) required in crash, conviction or judgment cases?

What happens if my SR-22 is cancelled?