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Indiana Car Insurance Basics

For motorists in Indiana, it's important to know not only the rules of the road but the laws surrounding car insurance. Because the state has stiff penalties for people who do not meet their minimum insurance requirements, knowing these laws can mean the difference between a safe, secure driving experience and one that is full of worry and frustration.

Since most drivers in IN want to follow the law, knowing what is required in terms of car insurance can make doing that even easier. It's simply a matter of education, where drivers look up and read the information that they need to know and follow through on carrying it out. If all drivers in the state did this, the experience of operating a motor vehicle there would be safer and easier.

Basic Indiana Auto Insurance Laws

In order to drive legally in Indiana, all motorists must be able to demonstrate that they can be financially responsible in case of an accident. This assures other drivers that they can pay for any damage or destruction that they cause. There are several ways that the state allows motorists to offer this proof of responsibility.

First, drivers can file a certificate of self insurance. This basically means that the driver agrees to pay all damage out of his own pocket. It is most often accompanied by the filing of a bond or some other proof that the driver does, in fact, have the money to claim this sort of responsibility.

Secondly, motorists can deposit $40,000 to be held in cash or securities by the state. This money will be used to pay for any damages or injuries that the motorist might cause over the course of his or her driving.

Finally, Indiana drivers can purchase certain minimum amounts of car insurance to cover their financial responsibility requirements. This involves purchasing insurance through a traditional auto insurance company and keeping the policy up to date at all times. Motorists must pay their premiums on time in order to keep their insurance and must be responsible for knowing that their policy meets the state's minimums.

It might seem unfair that it is the duty of the motorist to make sure his policy meets the state's minimums. While, in the long run, a derelict insurance company that sold policies not meeting the state's requirements would be punished, in the short run it would be the motorist facing legal difficulties. Thus, while the insurance company carries some responsibility in cases like this, it is in your best interests to educate yourself and determine if your policy meets the state's standards.

Indiana Required Vehicle Insurance

The first type of automobile insurance that the state of Indiana requires is called liability insurance. This is insurance that you would carry to cover the costs of any damages or injuries incurred in an accident that you caused. It does not cover your own costs, however, but just those of other, innocent parties involved in the accident.

Liability insurance comes in two types in IN. The first of these is called bodily injury liability insurance. This coverage pays the medical bills of anyone injured in an accident that you cause. In addition, it will pay the funeral costs of anyone killed in an accident that is your fault and, under certain circumstances, will pay for lost wages or long-term care required by someone who is severely injured in the accident.

The second type of liability insurance is property damage liability. As its name implies, this type of insurance pays to repair or replace any property that is damaged or destroyed in an accident that you cause. Usually, the property in question is a vehicle that requires repair or that is so damaged that it is more cost effective to replace it than to repair it. However, the insurance will also cover any other property that is damaged, like buildings, fences, signage and landscaping, as long as the damage occurred as a direct result of the accident.

Not only does IN law require motorists to carry these types of insurance, but they also require them to carry it in certain minimum amounts. For bodily injury liability insurance, all drivers in the state must have at least $25,000 of coverage for any one person injured or killed in an accident and at least $50,000 for more than one person injured or killed in the same accident. For property damage liability insurance, motorists must have at least $10,000 of coverage per accident.

Note that these are only minimum amounts of insurance that Indiana requires. Medical bills, funeral costs, or the cost of repairing and replacing property in any given accident could run much higher. Many vehicles, for instance, would cost more than $10,000 to replace. If the other motorist does not have supplemental insurance or if the insurance company chooses to contest, it's quite possible that you could be held responsible for any costs above and beyond those covered by your auto insurance in a case like this. Unless you have access to money that could cover costs like these, it may be wise to carry liability insurance in amounts higher than the minimums.

In addition to liability insurance, Indiana requires that all new auto insurance policies come with uninsured and underinsured motorist coverage. These types of coverage will pay for your medical costs and the repair or replacement of your property if you are in an accident that is the fault of a driver who does not carry the required minimum amounts of insurance or who does not have enough insurance to cover your losses.

Uninsured motorist coverage comes in both bodily injury and property damage forms, like liability insurance. The minimal amounts you must carry are the same as for liability insurance. You must have $25,000 worth of coverage for one injured or killed person, $50,000 for more than one, and $10,000 of property damage coverage. In addition, you must have at least $50,000 of coverage in the category of underinsured motorist bodily injury coverage.

Note that the requirement to carry uninsured and underinsured motorist coverage makes Indiana's vehicle insurance laws stricter than those of many other states. If you are moving to IN from another state, you'll want to be sure that you have this required coverage.

Other Indiana Insurance Laws

In addition to the requirement to have certain types of auto insurance in certain amounts, Indiana requires all drivers to have proof of their insurance with them in their vehicles at all times and to show it when it is requested by an officer of the law. If you have to go to court for a vehicle related offense, you should also carry your automobile insurance card with you then. Finally, you must show your insurance card to register your vehicle in Indiana.

If you follow all of these laws, you can rest assured that you are meeting the IN state requirements regarding car insurance. While some of these requirements might sound confusing at first, auto insurance companies in the state are aware of them and should be able to help you figure out what insurance you need and how much of each kind you want to purchase.


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