When you relocate to Louisiana or become a licensed driver for the first time, you need to purchase the necessary insurance coverage to comply with the state’s auto insurance laws. Most states have an auto insurance requirement for drivers, and the primary purpose of the requirements is to ensure that drivers can financially take responsibility for any damages that they cause while driving. By law, drivers must take financial responsibility, but many drivers in the state lack the money to do so without insurance coverage.
While most states have auto insurance requirements, be aware that each state has unique requirements as well as unique penalties for non-compliance. If you have recently moved from another state, do not assume that your coverage complies with local requirements. It is important that you understand the state’s requirements and consider the need for or benefit of buying additional auto insurance coverage.
Understanding the State’s Insurance Requirements
The necessary insurance coverage that Louisiana drivers must purchase is liability insurance. Liability insurance specifically pays for the damages that you cause to others while operating your car. These damages may include vehicle repair costs, medical bills, property damage repairs and more. The specific requirements include bodily injury coverage of $15,000 per person in an accident and $30,000 per accident. It also includes $25,000 for property damage. Remember that these are the maximum amount of benefits that your insurance company will pay for a single claim. You will be responsible for paying your deductible for each claim that you file. You should also be aware that this coverage does not pay for any expenses that you incur related to an accident, theft or other events. If you only purchase liability coverage, your policy will not pay for any of your own expenses.
Determining the Need for Additional Coverage
There are two other primary types of coverage that local drivers often purchase. Some auto lenders require these additional coverages, and you should check with your lender about auto coverage requirements before buying coverage. Collision coverage specifically pays for your own vehicle repairs or for a replacement if your car is damaged in a collision event. It does not pay for losses related to theft, bad weather, fires and more. Comprehensive insurance does provide benefits for these and other perils. You may still want to add optional coverage for rental car reimbursement, personal injury, lost personal property and more.
Buying additional coverage beyond the necessary insurance coverage required by the state can increase the cost of your premium by a healthy amount. However, you should consider the severe financial loss that you may incur if your vehicle is totaled and if you are seriously injured in an accident. Buying additional coverage may be financially worthwhile if an unfortunate accident occurs.
Reviewing the Penalties for Being Uninsured or Under-Insured
You may be wondering how the state would find out if you are violating its auto insurance law and what the impact of a violation would be. Be aware that the state requires insurance companies to report canceled and expired policies to it. Therefore, the state will be aware of a violation regardless of if you are pulled offer for a moving violation or not. If you are pulled over for a moving violation and cannot provide proof of insurance, the law enforcement officer may remove your license plate and provide you with three days to provide proof of coverage or may impound your car. You may receive a Notice of Violation for the necessary insurance coverage law. This may result in a fine of between $100 and $1,000, and the fine amount will be based on how many previous violations you had. You must also pay a reinstatement fee.
You can see that the financial impact of not being insured according to the state’s minimum requirements can be expensive. It can also be expensive if you are involved in an accident without collision or comprehensive insurance or if your liability coverage does not adequately pay for all expenses that you are responsible for. Drivers in Louisiana cannot afford to drive without insurance. Now is the time to review your current coverage and to update it as needed so that you are fully protected while on the road.