New York Car Insurance Laws

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New York State drivers must have auto insurance and comply with insurance laws to be able to drive legally in the State. Although New York’s minimum insurance requirements are more stringent than those in other states, they may not be sufficient to protect you adequately.

New York had almost 500,000 traffic accidents and 881 deaths in 2019. While the average claim payout was $6.360 for injuries, accidents can cost hundreds of thousands of dollars and an insurance policy will provide you with protection against expensive, out-of pocket costs.

New York’s Car Insurance Laws

New York is a state that is no-fault. This means that drivers must have personal injury protection (PIP), in addition to their liability insurance. Uninsured motorist coverage is also required by the state. The complete list of New York’s car insurance requirements is here:

  • $10,000 property damage in one accident
  • $25,000 bodily injury coverage for one person involved in an accident
  • $50,000 per accident for bodily injury (if more than one person is hurt)
  • Personal injury protection (PIP), $50,000
  • $25,000 per person/$50,000 for bodily injury to an uninsured motorist
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These are the minimum requirements that your insurance policy must meet. For greater protection, you can purchase additional coverage.

Legally, your auto insurance provides proof of financial responsibility. Your insurance card shows others that you can pay for injuries or damages caused by an accident. You can present your insurance card after an accident to prove that you are capable of paying for the damages or injuries.

An Alternative Proof of Financial Responsibilty is an alternative, which is less well-known. It is offered in certain states. This option allows you to meet the state’s requirements in a different way and is issued a certificate which replaces your insurance ID card. There are three options available to you for this:

  • You can deposit $150,000 with the DMV as security to cover any claims you may have after an accident
  • You can file a surety bonds with the DMV. This means that the surety company will pay for your claims and then collect the money from you.
  • You can apply for self-insurance, which is only available if you have more than 25 vehicles.
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However, insurance is required according to the New York Department of Motor Vehicles. You will need to check with your local DMV to determine if you are eligible for Alternative Proof of Financial Responsibilty.

New York Liability Insurance

Liability insurance covers the costs of injuries or damage to other cars in an accident. The minimum amount of liability insurance you will need to be able to drive in New York is 25/50/10.

Is the minimum sufficient? The minimum amount may not be sufficient to cover your expenses if you are involved in a serious accident. The minimum amount for property liability is $10,000. If the car of the other driver was damaged or destroyed, $10K may not be enough to replace it.

Consider the $25,000. Minimum bodily injury. The $25K limit could quickly be exhausted if a passenger in another car sustains serious injuries that require hospitalization or surgery.

It is therefore important to have as much liability insurance as possible. no fault states. New York is one. No-fault New York laws allow you to file a claim on your insurance policy after an accident regardless of who caused it. If another driver pulls a red light on you and hits you, your claim would be made to your own insurance provider, not the other driver’s.

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Personal injury protection (PIP) is the portion of your policy that covers you in this situation. PIP covers your medical expenses, lost earnings, funeral expenses, as well as any additional costs. The maximum amount of PIP is $50,000 per person. You can raise this amount for an additional fee.

PIP is required in New York State as in all other no-fault states. New York law prohibits drivers from driving without insurance.

New York Penalties for Driving Without Insurance

Neglecting to have insurance in New York could lead to serious consequences. If your policy is canceled by your insurance company, you must notify the DMV. You must give your registration and plates to the DMV if you don’t have insurance. You could be facing the following penalties if you drive:

  • Fines that increase with time
  • Vehicle impounded
  • Your driver’s licence can be suspended after 90 days
  • You could be charged or arrested

You could be fined up to $1,500 and a $750 civil penalty if you drive without insurance and cause an accident in New York.

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Additional Auto Insurance Options in New York

To be more protected, you have other options than the New York required liability, uninsured motorist and PIP coverage. Prices vary depending on which insurer you choose, the details of your vehicle, and your driving skills.

  • Collision coverage: This optional coverage pays for damage to your vehicle if it is involved in an accident with another car, cars, or stationary objects. Only collisions with animals are not covered by this policy.
  • Comprehensive: Often purchased with collision, comprehensive covers all mishaps other than an accident, including a tree falling on you in a windstorm to theft or vandalism. New York State does not require it. If your car is newer, or you have a high-end vehicle, collision and comprehensive coverage are great options. It may not be necessary for older cars of lesser value.
  • Medpay: optional for New York. Medpay will supplement your existing coverages like PIP and help you pay for any medical expenses incurred as a result of an accident. These could include hospital stays, surgeries, ambulance costs, or any other medical expenses.
  • Gap coverage This option helps you pay off your car loan if it is stolen or damaged. Your comprehensive or collision will first pay for the depreciated car’s value. If your loan amount is greater than this, gap coverage will cover the excess. This means that you don’t have to pay any out-of-pocket costs other than a deductible.
  • A new car replacement is available if your vehicle is stolen or totaled and it is less than two years old (or, for some insurances, less than one year). This will allow you to buy a replacement car with the same value.
  • Towing and labor coverage/roadside assistance: Similar to AAA or other roadside assistance companies, this will pay for repairs or towing in the event that your car is damaged or runs out of gas, or if you have a flat tire or are having a mechanical problem. It can be used if your car is locked out or you need to jump-start it.
  • Rideshare: You will need this coverage if you work for a ride-sharing company like Uber or Lyft. If your car is being used for business purposes, your personal auto insurance policy will not cover it. You will need this extra coverage to protect you while you are driving for hire.
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Most Frequently Asked Questions

Which is the best auto insurance company?

Each person will have a different opinion on which company is the best. There are many factors that go into choosing the right car insurance company. Our Best Car Insurance Companies For 2020 review is a good place to begin your search.

What is financial responsibility?

Financial responsibility is the ability to prove that you have enough money to pay for repairs and legal fees. You can show your financial responsibility to the police and the other driver in New York State by showing your insurance card.

What amount of liability insurance do you need?

New York’s liability minimums are 25/50/10. However, this coverage may not suffice if you are in an accident that results in serious injury. Experts recommend you buy as much insurance as possible — at a minimum, bodily injury liability should be $100,000/$300,000. Property damage should be $50,000.