Understanding the Different Types of Car Insurance in Texas: A Comprehensive Guide
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If you're driving in Texas, you need car insurance. Like nearly every other state, Texas requires you to have a minimum insurance policy to own or operate a vehicle. But in such a populous state with a lot of cars on the road, it's a good idea to get more than the minimum coverage.
Here, we break down the types of car insurance in Texas and provide tips to help you find the best insurance policy for your vehicle and budget.
Car Insurance in Texas
What type of car insurance do you need in Texas? It depends on your vehicle and personal situation. However, any insurance policy must meet legal minimum requirements.
Legal Requirements for Car Insurance in Texas
Texas uses what's known as 30/60/25 coverage. This means you must have at least:
- $30,000 of coverage for injuries per person, up to a total of $60,000 per accident
- $25,000 of coverage for property damage
Review the insurance requirements of your state:
Types of Car Insurance Coverage
There are many types of car insurance in Texas. We break down some of the most common below.
Liability Insurance: What It Covers
The 30/60/25 coverage we just explained refers to liability insurance. This type of coverage protects other drivers on the road, ensuring that if you cause an accident with another vehicle, you have the insurance necessary to pay for the other driver's property damage and injuries. Liability coverage is broken down into bodily injury and property damage coverage.
Collision Insurance: Protecting Your Vehicle
Collision coverage is a common add-on to an insurance policy, covering repair or replacement costs for your vehicle after a collision with another vehicle or stationary object, like a highway median or tree. Since Texas is an at-fault state, meaning that the driver deemed at fault for an accident must pay for their own and the other driver's damages and medical bills, it's important to have collision insurance.
Comprehensive Insurance: Additional Protection
Many drivers also opt for comprehensive coverage. Sometimes referred to as "full coverage," this add-on helps pay for repair or replacement costs for non-collision-related damages. This includes theft, vandalism, and acts of nature like fires or floods.
Medical Payments Coverage Explained
While liability insurance is legally required to help cover another driver's expenses if you're at fault for an accident, medical payments coverage can help with your own medical expenses from an auto accident. It can also pay the medical expenses of your passengers and any family members driving the insured vehicle when the accident occurred.
Medical payments coverage may help pay for doctor visits, hospital stays, surgeries, X-rays, and more.
Personal Injury Protection (PIP): What You Need to Know
Legally required in certain states (though not Texas), personal injury protection (PIP) helps pay for medical expenses and lost wages for you and your passengers if you're hurt in a covered accident. It's also known as no-fault insurance.
Uninsured/Underinsured Motorist Coverage
If you're in an accident with an uninsured driver, this type of coverage helps pay for your medical expenses and property damage incurred from the accident.
Gap Coverage
An important add-on for drivers who bought a car with a loan or are leasing a vehicle, gap insurance helps pay off your auto loan if your car is totaled or stolen and you owe more than the car's value.
Choosing the Right Coverage for Your Needs
Finding the right auto insurance in Texas depends on various factors. You must meet legally required minimums, but you also need coverage that will help you out in the most likely scenarios.
For instance, most drivers opt for full coverage, including comprehensive and collision, to help cover costs associated with vandalism or unpredictable accidents on the road. If you have a medical issue that increases your risk of being seriously injured in even a minor crash, it's a good idea to invest in PIP or medical payments insurance.
Ultimately, the best insurance policy includes premiums that fit your budget and coverage that gives you peace of mind.
The Implications of Driving Without Insurance
Driving without Texas car insurance may have serious consequences. If you're unable to provide proof of insurance, you'll face the following penalties:
- First offense: Fine ranging from $175-$350
- Future offenses: Fines ranging from $350-$1,000 and license suspension, plus an annual responsibility surcharge of $250 for the next three years, a requirement to file form SR-22 to prove financial responsibility, and a misdemeanor conviction on your record.
Factors Influencing Insurance Premiums
Everybody wants to lock in the best insurance premiums possible. Knowing the following factors will help you find the best types of car insurance in Texas for your budget.
Age and Driving Experience
Teen drivers and drivers over 65 tend to pay higher premiums. Keep up with insurance news to learn about discounts for student drivers, drivers who pass defensive driving courses, or those who don't drive often.
Vehicle Type and Safety Ratings
Luxury vehicles, foreign vehicles, sports cars, and electric vehicles tend to be more expensive to insure. On the other hand, practical vehicles with good safety ratings and high mileage will likely score lower premiums.
Driving Record and Claims History
A clean driving record is one of the most important factors in determining your premiums. In addition to a lack of accidents or traffic violations, having no claim history shows an insurance company you're likely not an at-risk driver.
Make Informed Decisions About Car Insurance
There are many types of coverage in Texas, and finding the right policy for you can feel overwhelming. Use EverQuote's comparison tools to compare offers from insurance companies in real time and make informed decisions about your coverage.