Is motor vehicle insurance mandatory?

The simple answer is “yes” for most states.  Though the requirements vary wildly.  Some states require Personal Injury Protection, others require Bodily Injury and Property Damage to Others and/or Uninsured Motorist coverage or some combination of all three.

In the State of Florida, the basic requirement is Personal Injury Protection (PIP) and Property Damage to Others.  

Personal Injury Protection

PIP is basically like an accident health coverage for injuries you sustain in an automobile accident.  The total amount of coverage is up to $10,000 and can have a deductible if you choose to, in order to save on premium.  PIP coverage is “no fault”, this means that regardless of who’s fault the accident was, everyone’s own PIP coverage pays for their covered medical cost.  Individuals such as children who don’t have PIP coverage because they don’t own a car are covered by the policy of the family member they live with.

Property Damage

Property Damage to Others (or PD) is coverage for your negligence (or fault) for an accident where someone else’s property gets damaged.  Someone else’s property can be almost anything.   A pet that gets hurt, a car you collide with, a fence you hit or even the road if it’s sufficiently damaged and the Department of Transportation needs to repair it.

There’s more

The State of Florida also requires additional coverages for drivers who are involved in an accident without sufficient insurance or if you are convicted of Driving Under the Influence (DUI or DWI).

SR22

If you’re at fault in an accident and don’t have any Bodily Injury coverage the State requires that you then purchase the coverage and report it to them.  This is usually referred to as an SR22 (after the form it’s reported on).  Bodily Injury coverage helps pay for the medical bills of persons injured in an accident that is your fault.  It doesn’t cover you or your family (refer to PIP).  Obviously this doesn’t cover the accident where you didn’t have the coverage in the first place.  The State usually sets the limits (most commonly $10,000 per person / $20,000 per accident) and the length of time (most commonly two years) after you have made financial arrangements to reimburse those injured in the accident that triggered the coverage requirement.

FR44

If you are convicted of a DUI (DWI) the State of Florida requires that you carry Bodily Injury limits of $100,000 per person / $300,000 per accident and Property Damage to Others limit of $50,000 per accident.  This is also required to be reported to the State on a form named FR44.  Similar to above the State will set the time you’re required to carry and report the coverages after the accident is settled.

The penalty in Florida for violating any of the insurance requirements is revocation of your license.  In some counties you can even be arrested for not carrying the coverage.  So when it comes to mandatory coverages it’s definitely better to be safe than sorry.

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