If you are involved in an auto accident or stopped by a police officer and found to be driving without car insurance or proof of financial responsibility, you will be subject to penalties specific to the laws of your state. For violation of the financial responsibility law, those penalties could include a fine or loss of driving privileges. If you are uninsured and in an accident that involves property damage or injuries to people, you will be required to pay out of-pocket for any damages assessed by a court.
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What happens to me if I drive without auto insurance?
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What is auto insurance?
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Auto insurance is a contract with an insurance company that can protect you against severe financial loss if you are ever in an auto accident. Varying types of coverage act as a ?bumper? against various accident-related expenses, like liability, medical costs, damage to vehicles, and property damage.
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Must I have auto insurance?
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Most states have laws in the books that require basic auto insurance coverage for every driver. A few states ask only that you demonstrate "financial responsibility".
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Is automobile insurance available for everyone?
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Yes. Since most states require auto insurance of all drivers, the states have assigned risk plans to assure coverage if you are unable to find an insurance company willing to accept you. The exact type of plan varies from state to state, but assigned risk policies are usually relatively expensive. Why? Because a bad driving record makes you a bad risk for any insurer – even if they must accept you.
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What is assigned risk?
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If your state requires you to have auto insurance in order to drive, you may be faced with a dilemma if insurance companies won’t accept you. Most states, therefore, have some sort of assigned risk plan to assure that you can get coverage. The cost of insurance under the assigned risk plan may be high, but the plan must accept you.
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Who is covered by my personal auto policy?
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You and the family members, friends and associates that you let borrow your car are all covered by your personal auto policy. Explicit permission is not required each time they borrow your car. They are covered as long as they have a reasonable belief that you would have permitted the loan.
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Does car insurance remove the worry of a lawsuit?
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Though it helps, having car insurance does not stop anyone from suing you. It does provide the assurance that, if you are sued as the result of an automobile accident, the financial and legal resources of the insurance company will assist you in defending against the suit and paying any resulting damages.
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Where should I keep my proof of insurance?
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Keep a proof of insurance card in your vehicle at all times.
Most states require drivers to carry proof of insurance cards, sometimes called “insurance ID cards.” It isn’t a bad idea to keep another copy in your wallet, too.
Since identity theft is so widespread, store your vehicle title and registration at home. If you are required by state law to carry a copy of your vehicle registration, keep it in your wallet or locked glove compartment.
(Source of information: http://www.freeadvice.com)
