BODILY INJURY LIABILITY

BODILY INJURY LIABILITY

INTRODUCTION TO THE BODILY INJURY LIABILITY COURSE

Welcome to the Bodily Injury Liability course. The purpose of this course is to arm you, the insurance adjuster and insurance agent, with the relevant and adequate knowledge on matters pertaining to Bodily Injury Liability. At the end of this Bodily Injury Liability course, you should be capable of understanding the basics of Bodily Injury Liability.

Kindly note that this course should be read together with the Property Damage Liability course since the two are significantly inter-related. This will assist you in gain the best understanding of the two courses.

Please be guided that the contents of this course should only serve as guidance and an overview of the course. All the materials covering Bodily Injury Liability cannot be exhaustively covered under the course due to its dynamic nature. You are therefore encouraged to use supplementary materials on the topic to equip yourself further. 

The content of the course shall be as hereunder:

  1. Introduction to Bodily Injury Liability
  2. Coverage under Bodily Injury Liability
  3. Cost of Bodily Injury Liability
  4. Bodily Injury Liability Coverage Vs. Property Damage Liability
  5. Case study
  1. Alabama
  2. California
  3. Idaho
  4. Oklahoma
  5. Arkansas
  6. Colorado
  7. Florida
  8. Car insurance rates by state for 2022

Introduction to Bodily Injury Liability

Body injury liability insurance (BI) covers for incurred expenses of those who are injured, as a result of an automobile accident in which the insured is at fault (it protects their“body”). It however does not cover the injuries sustained by the insured. In the event that the insured is sued for damages, this coverage can also assist them in covering the cost of legal defense. It does not provide coverage for the policy holder’s personal injuries or damage to their own property. In most cases, personal injury liability insurance is included in a car insurance policy, and it is required in most states. According to Idaho Department of Insurance “Bodily Injury Liability coverage helps pay for other drivers’ and passengers’ injuries when the policyholder is at-fault in an accident.  This coverage typically covers the other person’s medical bills.”

Body injury liability coverage claims are categorized as “third-party claims,” which implies that one is filing a claim against the insurance company of the at-fault driver who caused the accident. For the purpose of ensuring that the insured receive a reasonable reimbursement for their expenses, they are generally required to establish and maintain a record of the accident. Everyone who is listed on the policy as a designated driver and who operates the covered vehicle is covered under the policy. If the drivers mentioned on the insurance are driving another person’s automobile with their permission, they are also covered under the policy. 

Most states require drivers to have a certain amount of automobile insurance. The majority of states require all drivers to have bodily injury and property damage liability insurance. Although the minimum amounts of liability coverage requirements might vary among states, the description used to refer to the bodily injury and property damage liability is applied in all states, this is a three-number method that separates bodily injury liability per person, bodily injury liability per accident and property damage liability per accident using slashes. For instance, bodily injury and personal property liability coverage are required in Arizona, with minimum levels of 25/50/15. 

The following are the definitions for each number: 

  • 25- For a single accident, $25,000 in bodily injury liability coverage to cover the medical costs of one individual injured.
  • 50- a bodily injury liability policy with a monetary limit of $50,000 to cover the medical expenses of many people involved in a single accident
  • 15- A property damage liability policy with a limit of $15,000 to pay the repair costs of another driver

Some states also require all drivers to carry medical payments or personal injury protection coverage, while some states compel car owners to purchase uninsured motorist coverage, underinsured motorist coverage, or both of these types of coverage.  

Coverage under Bodily Injury Liability

What is covered

Medical expenses: This category comprises emergency care services, hospital fees, ongoing care costs, and other related expenses. 

Legal fees: Should the other party decide to file a lawsuit against the insured Bodily Injury Liability coverage may be able to assist the insured in covering the costs of their legal defense as well as any court fees that may be linked with the case. 

Loss of income: If the injured parties are forced to leave work or are unable to perform their job tasks as a result of their injuries or continuous medical treatment, bodily injury liability coverage can help compensate them for the income lost from failure to work due to the accident. 

Pain and suffering: When there is emotional stress or continued pain as a result of an injury, some claims may be eligible for payment in such cases. 

Funeral expenses: In the tragic event that a fatality occurs as a result of an accident, bodily injury liability coverage will assist in the payment of any associated funeral expenses. 

The majority of states mandate a certain amount of coverage for this type of insurance. Body injury liability policies include policy limits, which are the maximum amounts an insurance provider will pay out if the insured is involved in a car accident. Higher restrictions can be selected if the insured wants greater protection. Depending on how many people are harmed, the insured will be covered for two distinct amounts: one for one person, and another for many individuals. If the insured requires even greater protection, they can acquire umbrella insurance at an additional fee. 

Umbrella insurance provides an additional layer of liability protection that extends beyond auto and house insurance policies, allowing it to cover claims that other plans are unable to cover. Umbrella insurance, often known as personal liability coverage, is designed to protect against claims in which a significant amount of money is at risk of being lost. 

Even if an insured satisfies the minimum liability coverage imposed by their state, they are advised to consider increasing their insurance coverage in order to better protect themselves and their assets this is because if they accidently harm someone and their expenditures exceed the limitations of their bodily injury liability coverage, they may be required to pay the remaining amounts out of pocket. Therefore, it is important to assess how much bodily injury liability coverage is sufficient for their situations and why they may want to obtain limits that are greater than the minimum requirements set by their jurisdiction.

For example, according to California law, all motorists must carry at least $15,000 in bodily injury coverage to cover the medical bills of one person injured in an accident, and $30,000 to cover the medical bills of several people injured in an accident. However, it is extremely possible that this will not be sufficient. As a matter of fact, the legal minimum liability limits in all states do not accurately represent the actual costs associated with compensating victims of auto accidents. According to the Centers for Medicare and Medicaid Services in the United States, the average cost of healing a broken leg can be as high as $7,500, and a three-day hospital stay might cost as much as $30,000 in some cases. 

As a result, if one is at fault in an accident and the other motorist has a broken leg, the medical bills could total $37,000 or even more. The compensation for lost wages and pain and suffering is not included in this figure. In this case, it may be estimated that if one merely obtained the state’s bare minimal level of bodily injury liability coverage, they would be liable for at least $22,000. If the injured driver does not have medical insurance or underinsured motorist coverage, they may file a lawsuit against such person in order to recuperate their financial damages from them. Financial experts recommend that an insured carries at least $100,000 in bodily injury liability coverage for one wounded person and $300,000 to meet the expenses of numerous victims. 

As aforementioned, the limit amounts for bodily injury coverage are specified in two different ways: one for one person, and another for many individuals. Coverage limits are the maximum amount of money that an insurance will pay out in the event of a covered claim. The bodily injury per-person limit is the maximum amount the insurance policy would pay out for each person injured in an accident in which the insured is found to be at fault – up to the per-accident limit set by the policy. The per-accident bodily injury coverage is the maximum amount of money an insurance policy will pay out in the event of an accident in which the insured is determined to be at fault regardless of how many people are hurt. 

What is not covered

Bodily injury liability insurance can help pay for a wide range of charges. 

It will not, however, cover the following items:  

  • Medical expenses for the insured and their passengers. It will be necessary for the insured and their passengers to carry medical payments or personal injury protection coverage.
  • Damage to another driver’s vehicle: If the insured cause damage to another driver’s vehicle, they will need property damage liability insurance to pay the costs of the repairs. 
  • Auto collision and comprehensive coverages safeguard the insured’s car, however bodily injury liability insurance does not. 

Cost of Bodily Injury Liability

The national annual average for vehicle insurance is $1,674 for full coverage and $565 per year for minimal coverage, according to Bankrate. However, this average does not reflect the actual amount an insured will pay for insurance. There are a multitude of factors that influence the cost of bodily injury liability coverage. These considerations include where the insured lives, their driving history, how much coverage they want to purchase, the make and model of their car, claims history, credit history, gender and marital status, and other factors.  

According to the Oklahoma Insurance Department, “Insurance companies use a variety of factors to determine a policyholder’s likelihood of experiencing an accident or loss. Some factors include but are not limited to: driving history; type of vehicle (including model, year and value); territory (where you garage and drive the vehicle); number of accidents; gender; age; and credit scores. Driving record history can only be used for three years.” It is Bankrate’s opinion that “Car insurance rates vary from state to state since there are a number of factors affecting premiums. Factors might include road conditions, the number of drivers and population of a city, the percentage of uninsured drivers, and any other factors increasing or decreasing the overall risk of drivers, such as claims in the area from at-fault accidents and weather-related incidents.”

Bodily Injury Liability Coverage Vs. Property Damage Liability

The distinction between bodily injury liability coverage and property damage liability coverage is explained below.

In the event that an insured is judged to be at fault for an accident, both bodily injury coverage and property damage liability policy will protect them; however, the coverage they provide is different. Property damage liability insurance helps to reimburse the insured for expenditures incurred when they cause physical damage to someone else’s property, such as their vehicle or garage door. When the insured is determined to be at fault in an accident, bodily injury coverage can help pay for the medical bills of anyone who has been wounded. It also assists in the payment of legal defense costs in the event that the insured is sued for damages along with the other coverages provided by the insurance as highlighted above.

Case studies

Different states provide different minimum requirements for the bodily injury liability insurance, let us evaluate some of these states.

Alabama

In Alabama one requires a minimum $25,000 per person and $50,000 per accident for bodily injury to others and $25,000 per accident in property damage liability. No individual shall drive, register, or retain registration of a motor vehicle designed to be utilized on a public road or highway unless the vehicle is covered by a liability insurance policy, according to the Alabama Mandatory Liability Insurance Law. §32-7A-3, Code of Alabama 1975.

As a result of Act 2016-361, a person who is involved in a motor vehicle accident and who was in breach of the mandatory liability insurance law and did not receive a citation at the time of the incident is subject to a civil penalty. A motor vehicle incident is described as “an incident involving the driver of a motor vehicle when a traffic citation was issued by a law enforcement officer or the driver of a motor vehicle was involved in an accident and an accident report was filed”.

Let us briefly look at the Code of Alabama, Mandatory Liability Insurance Law covered under §41-27-40 – §41-27-48

Under the Article, it is required that the Secretary of the Alabama State Law Enforcement Agency devise procedures for the agency’s use in conducting a thorough investigation into each motor vehicle accident to determine whether or not the driver of a motor vehicle involved in the accident has been issued with a citation for failing to comply with the Alabama Mandatory Motor Vehicle Liability Insurance Law. As soon as the agency determines that a motor vehicle driver has been given a citation for violating the Mandatory Motor Vehicle Liability Insurance Law in connection with a motor vehicle accident, the Article no longer applies to the driver, and the driver must have the citation handled in state criminal courts.

The agency shall make an independent determination as to whether or not the motor vehicle was insured per the Mandatory Motor Vehicle Liability Insurance Law when that motor vehicle incident happened after establishing that the driver of the motor vehicle did not receive a citation for failing to comply with the Mandatory Motor Vehicle Liability Insurance Law at the time of the accident. In some cases, the agency will issue an assessment of a civil penalty against a driver who was driving a motor vehicle that did not adhere to the mandatory motor vehicle liability insurance law when an accident occurred. The agency will charge them $200 for their first offense, $300 for their second offense, and $400 for their third or subsequent offenses for not having insurance. An exception to this rule is where the motor vehicle is owned by someone who has been licensed and is in the business of renting or leasing cars. 

A notice will be sent to the subject driver which must be sent to the address in the records of the agency or on a traffic citation or accident report. First-class US mail must be used to send it. In the notice, the person will be told that if within 45 days of the notice, they don’t pay the assessment in a way that the agency accepts, or file a notice of appeal with the agency appealing the assessment, their driver’s license will be suspended for 90 days. In this case, if a person doesn’t pay the civil penalty or appeal it, the person’s driver’s license will be suspended for 90 days, and the civil penalty will be deemed to have been paid.  However, the agency may give the person more time to pay if the person files a written settlement of the assessment. The extension can’t last more than 60 days. An assessment under these terms cannot be made more than six months after a car accident.

By rule, the agency must set up a hearing process and procedures for administrative dealing with the notice of assessment. There must be rules that say that the hearing must be held by a driver license hearing officer or another hearing officer chosen by its agency. There may be an informal hearing, and the only concern will be whether the motor vehicle was in compliance with the Mandatory Motor Vehicle Liability Insurance Law when it was being used at the time of the motor vehicle accident. The appeal shall not be a contested case as per the Alabama Administrative Procedure Act. The final order pertaining the appeal can be looked at in circuit court if a petition for review is filed within 35 days of when the final order is made in the original appeal.

In the case of a hearing, if a person is found to have violated the Mandatory Motor Vehicle Liability Insurance Law when driving a motor vehicle, the civil penalty will be final. If the person doesn’t pay the civil penalty in 15 days, their driver’s license will be suspended for 90 days. Persons awarded a civil penalty pursuant to the Article may not have their driver’s licenses reinstated until the civil penalty is paid in full.

The Highway Traffic Safety Fund shall be credited with all civil fines collected pursuant to the Article every month. Once all actual and required expenditures have been deducted, the remaining funds will be allocated as follows: 

  • Of the total amount, 33 1/3 percent shall be put in the agency’s Motor Vehicle Replacement Fund. 
  • A total of 60 1/3 percent of the total shall be transferred in the Highway Traffic Safety and one-third of this cash will be used to improve communications for first responders, and two-thirds of this amount will be utilized to hire additional state troopers to supplement the existing force. 
  • 6 1/3 percent of all contributions be put in the Alabama Peace Officers’ Annuity and Benefits Fund as per Section 36-21-66.

Upon receiving a civil penalty for a violation of the Mandatory Motor Vehicle Liability Insurance Law, a driver will not be susceptible to a criminal penalty for the same offense.

California

Drivers in California are obligated to have the minimum required insurance for each of the named insurances is as follows: $15,000 per person and $30,000 per accident for Bodily Injury Coverage, $5,000 per accident for Property Damage Coverage.

In California, bodily injury liability insurance must have a minimum of so-called “15/30” insurance. This means that for a single accident, auto insurance will pay up to the following amounts: $15,000 for the wrongful death or bodily injury of a single person; or $30,000 for the wrongful death or bodily injury of all those injured or killed in the accident as discussed above. Driving without insurance in California means that the person does not have the above-mentioned amounts of liability coverage. But that’s not all there is to it. In accordance with the state vehicle code, persons are also required to provide proof of insurance coverage to a law enforcement officer upon request. For example, they can either display a physical copy of their insurance card or pull it up on their phone. In either case, however, they will need to present evidence of insurance when questioned in order to avoid receiving a citation for driving without insurance. 

If the insured does not want to purchase liability insurance, California provides them with additional options for demonstrating financial responsibility. The insured may deposit $35,000 with the DMV or obtain a $35,000 surety bond. However, in the majority of circumstances, purchasing an insurance policy is the most cost-effective and convenient option to obtain the proof of financial responsibility that an insured requires in order to lawfully drive in the state. 

Driving without insurance in California will subject a person to a fine ranging from $100 to $250, as well as penalty assessment, the court may also decide to impound the subject vehicle. This is the penalty for the very first conviction. A second time someone is discovered driving without insurance in California, the fee ranges from $200 to $500, plus additional penalty assessments. Furthermore, the vehicle may be impounded once again. The penalties for driving without insurance in California aren’t very severe. However, one could be subject to the additional penalty assessments listed below, depending on their location and what their local officials decide to rely on.

  • Penal Code 1464: $10 for every $10 or part of $10 of the fine
  • Government Code 7600: $7 for every $10 of part of $10
  • Government Code 70372: $5 for every $10 or part of $10
  • Government Code 76104.6: $1 for every $10 or part of $10
  • Government Code 76104.7: $4 for every $10 or part of $10
  • Government Code 76000.5: $2 for every $10 or part of $10

Furthermore, being involved in an accident without insurance results in a suspension of driving privileges. Most of the time, the insured will have a suspended license for one year, after which they can have it reinstated if their insurance company submits an SR-22 on their behalf.  That SR-22 will have to be kept in place for three years. Furthermore, when an insured requires an SR-22, their auto insurance premiums increase.  The SR22 is a form that is given by an insurer that verifies that the insured has satisfied the auto liability requirements needed by the state. Once it is issued, a copy of it is forwarded by the insurer to the California Department of Motor Vehicles (DMV).

Even if one was not at fault in an accident, driving without insurance in California severely restricts their legal options. They might get the liability insurance policy of the other motorist to cover the cost of their automobile repairs and medical claims, up to the policy limitations. However, because California is a “No Pay, No Play” state, they will not be able to seek compensation for non-economic losses. As an example, they would not be able to claim for money for pain and suffering.

Idaho

Idaho law requires that people have Bodily Injury Coverage on their auto insurance policy in the amount of $25,000 per person and $50,000 per accident and insurance on Property Damage Liability of $15,000 per accident at the minimum. According to the insured’s insurance policy, the coverage limitations are the maximum amount of money that the insurance company is obligated to pay to the other party on the insured’s behalf. Higher limitations, on the other hand, can be purchased in order to provide more protection. 

Owners of motor vehicles that have been registered or are used in Idaho by the said owners or by others subject to the owner’s permission, are obligated to continuously have insurance to protect against loss from liability imposed by law for bodily injury or death or damage to property incurred by any person caused by maintenance or use of their motor vehicles in the amounts provided by law as a precondition to have their motor vehicle registered. Such persons shall be required to show the existence of any other coverage needed or a certificate of self-insurance issued by the department. The law however provides an exception to this rule by providing for optional suspension of automobile insurance coverage under Section 41-2516, Idaho Code.

Just as the name suggests, the optional suspension of automobile insurance coverage allows a person who has contracted an insurer for coverage under an automobile insurance policy to suspend policy coverages. This is however not to be confused with a cancellation of the policy as the two are distinct. This suspension may begin at any time subject to the discretion of the person seeking the suspension but must have been confirmed in writing by the insurer to the person seeking suspension notwithstanding the method used by that person to request for the suspension of coverage. When the coverage is suspended, premiums shall not be charged to the person and neither will the insurer be liable to make any payments for loss under such suspended coverages occurring during said suspension period. The time within which the suspension will apply may be amended at any time once the parties, the insured and insurer have a written agreement on the amendment. This does not restrict the insurer from conducting a re-inspection of the previously insured motor vehicle to determine whether or not it is insurable. If a person operates a motor vehicle inside the state of Idaho while the liability coverage of his or her insurance policy is suspended, that constitutes breach of the law that is subject to the same punishment as those imposed for lack of state mandated insurance.

The law refers to having “Proof of financial responsibility” which means a proof that the owner, operator, or user can pay damages for liability in the amount of twenty-five thousand dollars ($25,000) for bodily injury or death to a single person in any single accident, fifty thousand dollars ($50,000) for bodily injury or death to two (2) or more persons in any single accident,  and fifteen thousand dollars ($15,000) for injury to or destruction of property of others in any single accident when accidents occur.

The director of the department of insurance can accept an indemnity bond from a motor vehicle owner instead of a policy of liability insurance. Liability for bodily harm, death, or damage to property caused by the operation, maintenance, or use of the motor vehicle sought for registration is covered by this bond, which ensures that any loss will be compensated within thirty (30) days. 

There must be no less than $50,000 in indemnity bonds to cover the cost of any one accident in which fifteen thousand dollars ($15,000) of property damage is involved, for each vehicle registered, up to a maximum of $120,000 for five (5) or more vehicles.

The bond made as aforementioned shall be considered to be, a continuing instrument and shall cover the duration for which the motor vehicle is to be registered and operated. Any such bond must be in the form allowed by the director of insurance and must be with a surety firm that is authorized to do business in the state.  A motor carrier is required to maintain continuous insurance coverage against loss resulting from responsibility imposed by law or by regulation of the department, and to meet with the insurance requirements of Idaho Code.

Any person who violates the above insurance requirements for the first time is guilty of an infraction punishable by a fine of seventy-five dollars ($75.00). A second and any subsequent conviction for a violation within five (5) years of the first conviction shall be considered a misdemeanor punishable by a fine not exceeding one thousand dollars ($1,000), or by imprisonment in the county jail not exceeding six (6) months, or by both fine and imprisonment in the county jail. Any individual convicted of a violation shall be notified by the department of the penalties that may be imposed on him or her for a second or subsequent conviction. 

Oklahoma
Driving without insurance is prohibited in the state of Oklahoma. The following types of car insurance coverage are necessary in Oklahoma: bodily injury to others and property damage liability coverage. 

Under §47-7-103 of the Oklahoma statute, the minimum insurance required is $25,000 per person and $50,000 per accident for Bodily Injury to others (subject to the limit for one person) and Property Damage Liability of $25,000 per accident. This requirement is specific to vehicle liability policies issued or renewed on or after April 1, 2005.

However, for vehicles liability policies issued or renewed before April 1, 2005, the minimum insurance is: 

  • Bodily injury to or death of one person in any one accident- a limit of not less than Ten Thousand Dollars ($10,000.00) 
  • Bodily injury to or death of two or more persons in any one accident, (subject to the limit for one person)- a limit of not less than Twenty Thousand Dollars ($20,000.00)
  •  If the accident caused injury to or destruction of property, – a limit of not less than Ten Thousand Dollars ($10,000.00) because of injury to or destruction of property of others in any one accident.

Let us look at the penalties for failing to have the minimum body injury liability required by the state

§47-7-606 provides that if a motor vehicle owner does not adhere to the compulsory insurance law, they shall be guilty of a misdemeanor and once convicted, they shall be given a fine of not more than Two Hundred Fifty Dollars ($250.00), or imprisonment for not more than thirty (30) days, or by both such fine and imprisonment and, their driving privilege might be suspended as provided in accordance with section 7-605. However, if a requesting law enforcement officer verifies valid and current security and compliance with the compulsory insurance law through the online verification system, there shall be no violation of the compulsory insurance law and no citation shall be issued.

The law enforcement officer issuing the citation may do any of these things:

  • If he or she has probable cause to believe that the motor vehicle being driven by the person is not in compliance with the state’s compulsory insurance law, seize the person’s vehicle and cause it to be towed and stored as provided by subsection A of Section 955.
  • Take possession of the car’s license plate and issue a citation to the driver of the vehicle, provided that the vehicle is in a drivable condition at the time of issuing the citation. For a period of up to ten (10) calendar days following the issuance of the citation, a copy of the citation retained by the owner or operator of the vehicle may be used as the temporary license plate for the vehicle on the road. It is not permitted to use the vehicle beyond the ten (10) calendar days, unless and until the vehicle operator or owner has completed the formalities to obtain the license plate back.

When a citation is issued, the law enforcement agency responsible for issuing it must deposit the license plate and deliver a copy of the citation to the county sheriff’s office in the county where the violation occurred within three (3) days of the issuance of the citation if the charges are to be filed in district court. If the charges are to be presented in municipal court, the law enforcement agency that issued the citation may choose to keep the license plate on record within their own organization. This information is provided to the plan administrator by the county sheriff’s office or municipal police department that is storing the license plate by entering the information into a statewide database maintained by the plan administrator who will be responsible for maintaining a database including all seized license plates and for submitting this information to the Oklahoma Tax Commission.

Following submission of documentation demonstrating compliance with the Compulsory Insurance Law, payment in full of an administrative fee of One Hundred Twenty-five Dollars ($125.00) to the county sheriff’s office or municipal police department, and payment in full of the citation to the court clerk, the vehicle owner or operator may retrieve the license plate from the county sheriff’s office or municipal police department. The administrative fee will be transferred to the Plan Administrator by the county sheriff’s office or municipal police department. The Plan Administrator shall notify the Oklahoma Tax Commission that the vehicle owner or operator has complied and shall divide the administrative fee in the following proportions:

  • In order to defray any costs associated with storing the seized license plate, the county sheriff’s office or municipal police department that stored and seized the plate shall receive twenty dollars ($20.00) of the fee
  • Seventy dollars ($70.00) of the fee will be sent to the law enforcement agency that issued the citation, and it may be used for any legitimate purpose
  • 25 dollars ($25.00) of the fee will be transferred to the Temporary Insurance Premium Pool
  • The Plan Administrator will keep ten dollars ($10.00) of the fee

When an individual by the end of the second business day immediately following the date of citation, provides proof to the law enforcement agency that issued the citation and is storing the seized license plate that a current security verification form or equivalent form that has been issued by the Department of Public Safety reflecting liability coverage for the individual was in force at the time of the alleged offense, the individual will not be required to pay the administrative fee. 

The individual must pay the full administrative if no such proof is produced within that time period, regardless of whether the person had minimum car liability insurance coverage at the time of the citation. 

According to applicable state law, the county sheriff’s office or municipal police department may dispose of any unclaimed license plate after ninety (90) days. It will be necessary for the operator or owner to obtain a replacement license plate after the license plate has been disposed of by the county sheriff’s office or municipal police department in accordance with all applicable procedures. It is prohibited for an officer to seize a license plate or a vehicle if the operator of the vehicle produces what appears to be a valid security verification form and the officer is unable to confirm compliance through the online verification system or noncompliance through a subsequent investigation. It is also prohibited for an officer to tow the vehicle and store it. No car shall be impounded or town if the vehicle is still operating with a temporary license plate that has not expired in accordance with the provisions of sections 1137.1 and 1137.3. 

In the event of a conviction for a breach of the compulsory insurance law, the court may order that the sentence be suspended or deferred in whole or in part. Any person who can demonstrate in court that he or she had a current security verification form or comparable form issued by the Department of Public Safety demonstrating liability coverage for the person at the time of the alleged offense will be entitled to have the case against them dismissed. Provided that the court receives proof of security verification by no later than the business day preceding the first planned court appearance date, the case will be dismissed without the need to pay court fees. The court may use information from the online verification system to determine whether or not a party is covered by liability insurance. The court will not dismiss the fine unless and until the court receives proof that the person’s liability coverage was in effect at the time of the alleged offense. Following a conviction or bond forfeiture, the court clerk is required to provide an abstract to the Department of Public Safety within five (5) days of the court’s decision, detailing the court’s decision. 

Arkansas

Car insurance coverage for bodily injury to others and property damage liability are needed in Arkansas for all drivers. One needs insurance on Bodily Injury to others of $25,000 per person and $50,000 per accident and insurance on Property Damage Liability of $25,000 per accident.

The Arkansas Insurance Department through their website state that every owner of a motor vehicle is required to have liability insurance and when they are at fault in an accident, the liability coverage pays for any claims that are filed against them. The website further states that the law requires one to carry a certain amount of liability insurance, which is $25,000 per person for physical injury, $50,000 for an accident, and $25,000 for property damage to other people’s property but almost all insurance companies provide higher policy limits. The option to purchase uninsured motorist bodily injury and property damage, and underinsured motorist bodily injury and property damage coverage must be made available to someone when they apply for liability coverage. The coverage for uninsured motorists protects the insured and their vehicle in the event that another driver is at fault and does not have liability insurance. Underinsured motorist coverage provides the insured with additional protection in the event that the other driver is at fault but does not have enough insurance to cover the insured’s injuries. Personal Injury Protection on the other hand, compensates the insured for lost wages, death benefits, and medical expenses, regardless of who is to blame.

The website further advices people that they may also choose to add to the aforenamed coverages by taking up comprehensive and collision coverage to their policy. Comprehensive coverage will provide protection against damage to their automobile caused by acts of nature or other incidents that are not related to the operation of the vehicle and when their automobile is involved in an accident, collision coverage protects them against damage to their vehicle. Further the public is advised that there are discounts allowed; there are two types of discounts available to insureds 55 and older who have successfully completed a course approved by the Office of Driver Services: The College Graduate Discount and the Defensive Driver Discount but persons should ask their agent if they are further discounts available.

The Code of Arkansas under section 27-22-104, states that to operate a motor vehicle in the state, the person must have either:  a certificate of self-insurance issued under 27-19-107 or an insurance policy issued by an insurance company authorized to do business in the state for the motor vehicle and the person’s operation of the motor vehicle. The policy must provide, at a bare minimum, the following types of protection: 

(1) For bodily injury or death of one (1) person in any one (1) accident- Not less than twenty-five thousand dollars ($25,000);

(2) For bodily injury or death of two (2) or more people in any one (1) accident- Not less than fifty thousand dollars ($50,000); and

(3) If the accident results in damage to or destruction of property, for damage to or destruction of property of others in any one (1) accident, -Not less than twenty-five thousand dollars ($25,000)

The section also provided that are rebuttable presumption that a motor vehicle or its operation is uninsured exists if either:  the driver or the insured fails to present proof of current insurance coverage in the form of a proof-of-insurance card issued pursuant to section 23-89-213 at the time of a traffic stop, or the online insurance verification system fails to show current insurance coverage for the driver or the insured.  

Moreover, the section states that in accordance with 23-89-213, a proof-of-insurance card or any temporary proof of insurance supplied by the insurance company that satisfies the requirements of that section may be presented in either paper or electronic format.  The term “electronic form” refers to the display of electronic images on a cellular phone or any other type of portable electronic device if the device has sufficient functionality and display capability to allow the user to display the information required under section 23-89-213 as clearly as a paper proof-of-insurance card or other paper temporary proof of insurance issued by the insurance company. The submission of evidence of insurance in electronic form does not: (a) grant permission for a search of any other content on an electronic device without a search warrant or probable cause; or (b) expand or restrict the authority of a law enforcement officer to conduct a search or investigate. 

Further, the owner of a motor vehicle that is in operation may be refused release from a government-owned and government-operated storage facility for motor vehicles if the owner cannot show that the motor vehicle is covered by insurance in accordance with the requirements of the section. Exceptions to this requirement include the following items: automobiles classified as salvage; automobiles in which an insurance has ownership, and an automobile that is not driven out of the government-owned and government-operated storage facility under its own power. 

Let us look at the penalties for failing to have the minimum body injury liability required by the state

Under section 27-22-103, a mandatory fine of not less than one hundred dollars ($100) nor more than two hundred fifty dollars ($250) will be imposed on any person who operates a motor vehicle in the state, unless both the vehicle and the person’s operation of the vehicle are covered by a certificate of self-insurance or an insurance policy, as required by 27-22-104. Upon a second conviction for operating a motor vehicle in violation of 27-22-104, a fine of not less than two hundred fifty dollars ($250) nor more than five hundred dollars ($500) shall be imposed, with the minimum fine being mandatory. For the third offense or any subsequent offenses, any person who operates a motor vehicle in violation of 27-22-104 will be fined not less than five hundred dollars ($500) nor more than one thousand dollars ($1,000), or sentenced to one (1) year in jail, or both. 

If it is demonstrated that the liability coverage required was in existence at the time of arrest, the judge may dismiss the charge brought against the person under the act, and no fines shall be imposed as a result of the dismissal. If the person cannot show that the liability coverage required is in effect at the time of the charge’s disposition, the judge or clerk of the court shall prepare and transmit to the Office of Motor Vehicle an order suspending the registration of the motor vehicle involved in the violation until the person presents proof of coverage to the Office of Motor Vehicle. The order must include the following information: (a) the person’s name and address; (b) the driver’s license number, if any; (c) the vehicle identification number or license plate number of the subject motor vehicle; (d) the date of the hearing; (e) the court’s decision; and (f) the amount of the fine. It is the responsibility of the judge or clerk of the court to write and submit the order within five (5) business days of the entry of the plea or verdict. 

It is the responsibility of the owner to provide proof of the required liability coverage to the Office of Motor Vehicle and to pay a twenty-dollar ($20.00) reinstatement fee to the Office of Motor Vehicle in order to have the registration for a suspended motor vehicle restored. In addition to being deposited as a special revenue into the State Central Services Fund, the revenues collected from this reinstatement charge shall also be credited as a direct revenue to be used by the Office of Motor Vehicle to defray the costs of administering the section. This amount is in addition to any other fines, fees, or other penalties that may be imposed for other violations of the section.

If the arresting officer is an officer of the Division of Arkansas State Police, the fine collected must be remitted to the Administration of Justice Funds Section of the Office of Administrative Services of the Department of Finance and Administration by the tenth day of each month, on a form provided by that office, for deposit into the Division of Arkansas State Police Fund, which will be used for the purchase and maintenance of state police vehicles. If the arresting officer is a county law enforcement officer, the collected fine will be deposited into that county fund and will be used to buy and maintain rescue, emergency medical, and law enforcement vehicles, communications equipment, animals owned or used by law enforcement agencies, life-saving medical apparatus, and law enforcement apparatus to be used for those purposes. Where the arresting officer happens to be a municipal law enforcement officer, the fine collected is deposited into that municipal fund that will be dedicated to the purchase and maintenance of rescue, emergency medical, and law enforcement vehicles, communications equipment, animals owned by or used by law enforcement agencies, life-saving medical apparatus, and law enforcement apparatus intended for use in those capacities. 

Colorado

The following are the bare minimum coverages mandated by the state, with the option to acquire greater levels of coverage: $25,000 for bodily injury or death to a single person caused by an accident; $50,000 for bodily injury or death to all persons caused by an accident; and $15,000 for property damage caused by a single accident.

Any individual who possesses more than 25 automobiles registered in his or her name may qualify as a self-insurer by submitting an application to the state Insurance Commissioner for a certificate of self-insurance. Insurance Commissioner must verify that the individual will be able to pay for the minimal coverages required by the state. 

Let us briefly look at Colorado Revised Statutes Title 42. Vehicles and Traffic § 42-4-1409. Compulsory insurance–penalty–legislative intent

It is against the law for a motorist to operate a motor vehicle without insurance in Colorado, according to Colorado statute CRS 42-4-1409. Under the section “no person shall operate a motor vehicle or low-power scooter on the public highways of this state without a complying policy or certificate of self-insurance in full force and effect as required by law.” Colorado compares its database of registered automobiles with a list of insured vehicles provided by all of the state’s insurance firms; if the state discovers a car that is registered but not insured, it notifies the policyholder of the discovery. If one is discovered driving without proof of insurance in Colorado, they will face the following fines: 

  • Four points against the driver license
  • First offense: a least $500 fine and license suspension until one can provide evidence of insurance to the Division of Motor Vehicles
  • Second offense (within a period of five years following a prior conviction): a minimum $1,000 fine and license suspension for four months
  • Third and subsequent crimes (within a period of five years following a prior conviction) are punishable by a minimum $1,000 fine and an eight-month license suspension
  • In addition to the above-mentioned sanctions, the court may impose up to a minimum of 40 hours of community service

Violation of the section is a class 1 misdemeanor traffic offense. A payment schedule may be established by the court or by the court collections’ investigator for a person who has been convicted. The court may suspend up to one-half of the fine if the court is satisfied that the relevant insurance coverage has been obtained as required.

One must provide proof of insurance when registering their vehicle as well as whenever they are behind the wheel. The following applies when an operator of a motor vehicle or low-power scooter uses a cell phone or other electronic device to produce evidence of a valid policy or certificate of self-insurance that is in full force and effect:

  • If the operator delivers his or her cell phone or other electronic device to a law enforcement officer, that officer is prohibited from investigating the contents of the device other than to review the operator’s insurance policy or certificate of self-insurance
  • Neither the law enforcement officer to whom the device is presented nor the agency in which the officer is employed are liable for any civil damages that may arise as a result of the officer dropping or otherwise unintentionally destroying the cell phone or other electronic device. 

Evidence of a person’s failure to present immediately evidence of a complying policy or certificate of self-insurance in full force and effect, as required by law, when requested to do so by a peace officer shall be prima facie evidence, at any trial concerning a violation charged, that such owner or operator of a motor vehicle was operating the motor vehicle without a complying policy or certificate of self-insurance in full force and effect.

If a person accused with violating the section presents in court a genuine complying policy or certificate of self-insurance that was in full force and effect as required by law at the time of the alleged infraction, the person will not be convicted of the violation. By using the uninsured motorist identification database established under Section 42-7-602, the court clerk’s office may be able to dismiss the charge if it can demonstrate that the person had a valid insurance in effect at the time of the claimed violation.

The general assembly intends for the money collected as fines imposed under the section to be used for the monitoring of public highways. The general assembly determines that law enforcement agencies that patrol and keep the public safe on public highways are in charge of supervising the public highways and that an authorized agent is supervising the public highways by enforcing the requirements for demonstrating proof of motor vehicle insurance in accordance with section 42-3-105(1)(d). As a result, fifty percent of the money collected from fines shall be remitted to the law enforcement agency that issued the ticket for a violation of the section. The remaining fifty percent transferred to the county in which the violations were committed. 

Florida

In order to lawfully register and drive a car in Florida, one is not required to have Bodily Injury Liability insurance. Many states, need drivers to obtain bodily injury liability insurance in order to drive, however Florida does not. Personal Injury Protection (PIP) and Property Damage Liability insurance coverage are the only types of insurance coverage required by Florida to obtain a driver’s license and drive: each must provide a minimum of $10,000 in coverage. If someone has been involved in a car accident or violated certain traffic laws, they are exempt from the requirement to carry bodily harm liability insurance on their vehicle. The Florida Financial Responsibility Law outlines the requirements for meeting these obligations. 

According to this law, an owner or operator of a vehicle involved in an accident resulting in at least $500 in property damage or physical injury must be “financially responsible” or else his or her license registration suspended. The financial accountability obligation can be accomplished by one of three methods specified by the law. If one already has a bodily injury liability insurance policy with at least $10,000 per person and $20,000 per accident coverage at the time of the accident, that is the simplest option. The other two solutions are significantly more difficult for the majority of people. One option is to deposit a $30,000 bond, whilst the other is to “self-insure,” which involves demonstrating at least $40,000 in unencumbered assets. 

Another exception is where one has been convicted of a DUI, they are required to obtain bodily injury insurance under Florida Statute 324.023 (Financial responsibility for bodily harm or death). It is necessary that the person was convicted on or before October 1, 2007, in order to be eligible for the minimum requirement of $10,000 per person and $20,000 per accident. For those who were convicted after October 1, 2007, the minimum amount required is $100,000 for each person and $300,000 for each accident. According to the law, one must maintain Bodily Injury Liability coverage for a period of three years following the restoration of their driving privileges.

Consider the possibility that someone decides to drive without BI coverage; the Florida Financial Responsibility Law, requires that a person who is at fault for an accident furnish financial coverage in the amount of at least $10,000 per person and $20,000 per accident. If one causes an accident that results in bodily injury to another person or persons, they must either carry BI insurance or post a bond for the amount of coverage that is needed by the law. If they fail to fulfill this duty, they may lose their driving privileges. Additionally, they will be forced to make financial arrangements in order to pay any judgments obtained against them for property damage and bodily injury before their driver’s license may be reinstated.

If one is at fault in an automobile accident and they are unable to meet the financial responsibility standards of the state of Florida, their license will be suspended for three years. The only option to get the license back sooner is for the injured individual to release them from all liability or for them to post security to cover the total amount of their claim.

It is however common advice that people in Florida should consider purchasing bodily injury liability coverage even if it is not required. This is due but not limited to the following reasons:

  • If they are at fault in a car accident and someone else is wounded, that person may be able to sue them for losses incurred. Coverage for bodily injury is the form of coverage that will compensate the injured party while also protecting the insured and their assets. The costs of hiring a counsel to defend them against a lawsuit will also be covered by their BI insurance.
  • Insurance companies will only sell Uninsured Motorist coverage if one also has Bi-Policy coverage, which is the second reason people in Florida are encouraged to get BI coverage. Uninsured Motorist (UM) coverage will protect them if they are injured by someone else who does not have sufficient bodily injury coverage to compensate them.

Car insurance rates by state for 2022

Please see below the Car insurance rates by state for 2022, by Bankrate.  The state minimum liability car insurance limits are divided by slashes that distinguish between bodily injury liability per person, bodily injury liability per accident and property damage liability per accident.

StateMinimum liability coverage limits (in thousands)Average annual cost of minimum coverageAverage annual cost of full coverage
Alabama25/50/25$469$1,623
Alaska50/100/25$373$1,559
Arizona25/50/15$555$1,547
Arkansas25/50/25$470$1,914
California15/30/5$733$2,065
Colorado25/50/15$518$2,016
Connecticut25/50/25$794$1,845
Delaware25/50/10$787$1,775
Florida10/20/10$1,101$2,364
Georgia25/50/25$756$1,982
Hawaii20/40/10$354$1,127
Idaho25/50/15$307$1,045
Illinois25/50/20$442$1,485
Indiana25/50/25$367$1,254
Iowa20/40/15$252$1,260
Kansas25/50/25$410$1,698
Kentucky25/50/25$748$2,128
Louisiana15/30/25$975$2,724
Maine50/100/25$294$965
Maryland30/60/15$767$1,877
Massachusetts20/40/5$510$1,223
Michigan50/100/10$948$2,309
Minnesota30/60/10$537$1,643
Mississippi25/50/25$492$1,782
Missouri25/50/25$468$1,661
Montana25/50/20$342$1,737
Nebraska25/50/25$335$1,531
Nevada25/50/20$860$2,245
New Hampshire25/50/25$389$1,275
New Jersey15/30/5$847$1,757
New Mexico25/50/10$385$1,419
New York25/50/10$1,062$2,321
North Carolina30/60/25$413$1,325
North Dakota25/50/25$285$1,264
Ohio25/50/25$328$1,034
Oklahoma25/50/25$423$1,873
Oregon25/50/20$610$1,346
Pennsylvania15/30/5$427$1,476
Rhode Island25/50/25$749$2,018
South Carolina25/50/25$558$1,512
South Dakota25/50/25$275$1,642
Tennessee25/50/15$371$1,338
Texas30/60/25$524$1,823
Utah25/65/15$528$1,306
Vermont25/50/10$292$1,207
Virginia30/60/20$441$1,304
Washington25/50/10$463$1,176
Washington, D.C.25/50/10$704$1,855
West Virginia25/50/25$458$1,499
Wisconsin25/50/10$332$1,186
Wyoming25/50/20$271$1,495

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