Texas Auto Insurance
How does where I am in Texas affect
my premium?
Where you live or, more
precisely, where you keep
your car at night has a
bearing on your chances of
having an accident or
becoming a victim of theft
or vandalism. That's why a
vehicle owner in Manhattan,
New York, pays a higher rate
than the owner of an
identical vehicle in
Brownsville, Texas.
Factors affecting
regional insurance rates
include time and efficiency
of police response and law
enforcement, local road and
traffic conditions and the
quality of local medical
services. Insurers even
factor in the litigation
rates in a given area--that
is, how many lawsuits are
filed, go to trial, are
settled out of court and for
how much.
Why are rates different for
different cars, even if the
cars cost the same?
Vehicles are also grouped
into categories according to
their chances of being
damaged, vandalized or
stolen. Insurers generally
consider the size and type
of vehicle, as well as the
value and the cost of
repairs which vary greatly,
even on vehicles that cost
about the same amount.
Therefore, it is assumed
that a new sport utility
vehicle is expected to hold
up better in an accident
than a sports car or a
subcompact or electric
hybrid car.
Putting insurance aside for
a moment, safety is key when
buying an automobile. Your
life and everyone who rides
with you depends on it! Some
cars are considered safer
than others because of their
performance record in safety
tests and real accidents.
That is why Texas consumers
should research insurance
coverage before you buy
their car. It helps you to
understand the actual cost
and indicates those vehicles
with good safety records.
Your insurer will ultimately
reward you for putting
safety first.
What is
"no-fault" insurance?
No-fault insurance is a
system adopted in some
states that essentially
bypasses the conventional
legal procedure which finds
fault in an accident. This
is the procedure by which
you hire a attorney, file
suit and possibly go to
court to prove the accident
was the other guy's fault.
No-fault simply does away
with the concept of one
party or the other being at
fault--no lawyers, no court,
no judge, no jury, no
lengthy lawsuits against the
other party. This is
considered beneficial to
taxpayers, because it
eliminates costly legal
proceedings that the state
must manage, and to
insurance policyholders,
because it helps keep rates
down.
If you are insured in a
no-fault state and have an
accident, you don't go after
the other driver. You
contact your own insurer and
file a claim. Your own
insurance policy guarantees
you immediate compensation
for damages, medical
expenses, lost wages,
essential services, rental
car arrangements etc.
The type and range of
no-fault coverage varies
from state to state. What
defines the limitations of
no-fault policies can differ
in two important areas:
-
Threshold--The type
of damage or injury or
the cost of repair or
recovery that triggers
the need for legal
action.
-
Mandated--Benefit
Level The package of
benefits (medical, wage
loss, replacement
services and other
expenses) your state
requires you to carry.
The details of no-fault
insurance can be
complicated. Contact your
agent or state's insurance
department for further
information.
Do all states require some
kind of liability insurance?
No. Some states, while not
mandating auto insurance,
have what is known as
financial responsibility
laws that require all
drivers to be able to pay
for any damage or injury
they may cause. However,
carrying liability insurance
is still the best way for
you to meet your state's
financial responsibility
requirements once you know
what they are.
UM and UIM policies are
offered by law in all
states, including no fault
states. In fact, some states
require all motorists to
carry this coverage in order
to gain protection from
inadequate insurance
coverage of other drivers
that may not carry enough or
higher limits as the
majority does; i.e.,
100-300-50,000.
What happens if I have an
accident with an Texas
uninsured or underinsured
driver?
First, call the police to
the scene to be sure all
pertinent information is
properly recorded. Your
nerves will be shaken right
after an accident, and it
helps to have a calm and
knowledgeable person walking
you through the necessary
details.
Then, contact your agent or
policy holder services or
claims number usually on you
ID Card immediately
and ask about filing a
claim. If you followed all
the recommended guidelines
and procedures when you
bought your policy, you
should be covered within the
benefits and or limitations
of that policy. Remember,
your car insurance policy is
designed to protect you and
anyone in your vehicle.
If the cost of your physical
damages or personal injuries
exceed the amount your
policy will pay for, it may
be time to take legal action
against the other party.
Even if you have no-fault
insurance, sometimes the
only way to be compensated
is to place blame and
responsibility where it
belongs. That is why it is
best to get a police report
documenting the incident and
any witnesses statement
while it is fresh in their
minds. This will preserve
that moment in time and
remove any room for doubt
later in the legal process.
It is better to have the
police report and not really
need it , than it is to need
one for court and not have
one because it would have
taken another thirty minutes
to an hour extra at the
incident scene.
Why would my Texas insurer
cancel my policy?
Technically, in most states
your insurer can cancel your
policy only if:
-
you fail to pay your
premium;
-
you lose your driver's
license;
-
you are guilty of
material
misrepresentation during
the application process
i.e., you fail to notify
your insurer of a
recorded violation, such
as a drunken driving, or
possession of drugs or
any illegal activity
offense; or
-
you fail to report a
substantial change of
risk, such as buying a
new high performance
sports car to replace an
old high mileage family
sedan.
However, your insurer can
choose not to renew your
policy for a variety of
reasons.
Do you have a bad driving
record? Have you received a
lot of speeding tickets?
Have you ever been caught
driving drunk? Not only are
these scenarios considered
unsafe and illegal, they are
justifiable cause for your
insurer to label you a bad
risk and refuse to renew
your policy. Some
underwriters may feel
compelled to cancel policies
after only one accident.
Where do you live? Has the
neighborhood changed in the
last few years? Have the
accident or crime rates
risen noticeably? As regions
are reassessed periodically,
their status could change
and you could suddenly find
yourself living in a higher
risk area, where your
insurer's rates may not be
adequate to cover losses.
What do I do if my Texas
insurer cancels or refuses
to renew my auto policy
Even "good" Texas drivers can find
themselves in the position
of being dropped by their
current carrier. Reasons
range from a couple of
moving violations, or
multiple accidents, or other
serious violations that make
you a high risk to
situations outside your
control, such as when
insurers in your state are
suffering severe business
losses. Overall rises in
claims or losses can cause
insurers to become highly
selective in determining
whom they can afford to
offer to insure.
That is why it is important
to note that if you are
licensed to drive, by law,
you are eligible for
insurance. However, your
options for new coverage may
be limited. Each state has
created and regulates a
market of last resort for
those who cannot otherwise
obtain coverage. These
groups have various names,
depending on the state you
live in, such as assigned
risk automobile insurance
plans or the residual
market, or the high risk
pool. Your assigned risk insurance agent or broker will know
more about the particulars
in your state.
Regardless of the reason you
were dropped or cancelled by
your insurer, you need to
act immediately to get
another policy. Under no
circumstance should you
drive your vehicle without
knowing one hundred percent
that you have current
insurance. Call your local
agent to help you find new
coverage. If you do find
yourself in the assigned
risk residual market pool,
the price may be higher but
it may be your only
alternative in maintaining
your freedom to drive.
How do I keep my Texas
insurance company from
canceling my policy?
The most obvious way to
maintain your low risk
status is to keep a clean
driving record. If you've
been in an accident,
consider taking a defensive
driving course. Even those
of us who have been driving
for years rarely know the
simple tricks to preventing
accidents through defensive
driving.
Also, look into purchasing
special safety and security
features for your car, such
as anti-lock brakes and an
alarm system, or try OnStar.
Your assigned risk insurance agent
can give you further tips on
how to convince your insurer
you're a safe driver.
What steps can I take to
reduce my Car Insurance
rates?
Insurers often discount
their rates in order to
encourage good driving
practices and the use of
safety and security
precautions. Depending on
the insurance company, you
can often lower your rates
from 5 to 55 percent.
Sometimes the investment you
make in your vehicle is
worth the discount, and
sometimes it's simply worth
some peace of mind. For
example, the purchase of
anti-lock brakes merits a
discount from nearly every
insurer, but the discount
probably will not pay for
the brakes which cost
several hundred dollars
during the normal life of
your vehicle. Anti-lock
brakes are touted,
nonetheless, as a
life-saving feature and
deserves serious
consideration when safety is
a top priority. Insurers
generally offer discounts
for:
-
Safety Features
Anti-lock brakes, air
bags and passive
restraint systems i.e.,
automatic seat belts.
-
Defensive Driving
Clean violation record,
driver's education
courses for teenagers
and defensive driving or
accident prevention
courses for adults
insurance discounts for
the latter are required
in some states.
-
Security Systems
Alarms, electronic
locks, VIN etching and
automotive disabling
devices.
-
Changing The Driving
Habits Try commuting
by public transit, using
a company vehicle for
work-related travel and
car-pooling.
-
Formal Agreements Not to
Drink and Drive The
availability of a
discount for signing
such an agreement varies
among insurers and
states, however is a
powerful idea that
works.
-
Buying Home Owners and
Auto Policies from the
Same Company If you
own a home and an
automobile and you are
insured by two different
companies, check into
the cost of carrying
both policies by one
insurer. Your agent can
give you guidance as to
which insurers offer
discounts. This will
always offer your the
best buy, so put it in
your corner when
shopping for rates
You can also lower your
insurance rates by
requesting higher
deductibles, which is the
amount of money you pay out
of pocket before you make a
claim. Increasing your
deductibles on collision and
comprehensive coverage from
$100 to $250, or even $500,
will bring your rates down.
Moreover, you may not need
collision and comprehensive
coverage if you drive an
older car. Ask your agent
which discounts are
available to you.
How does adding drivers to
my policy affect my rates?
The more people you allow to
drive your vehicle on a
regular basis, the greater
the chances of your vehicle
being in an accident. Texas
Teenagers are especially
expensive to insure because
they are the least
experienced drivers.
A driver's-ed course can
help ease the burden of
insurance costs since it
teaches your teenager
defensive driving
techniques. If your child's
high school does not offer
driver's-ed, try to find one
offered by another school or
a private firm in the area.
After all, the cost of
driver's-ed could be cheaper
than the extra cost of your
insurance. Many insurers
offer "good student"
discounts as well.
An adult's driving
experience can also affect
your rates significantly.
Don't assume that every
adult you know has been
driving as competent driver
with a clean driving or
insurance record. Again,
taking a defensive driving
course is a good way for
adults to prove they are
also responsible drivers,
thus lowering their risk and
their insurance premium
rates.
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