The Importance of Having Proof of Auto Insurance

Do you need proof of auto insurance when you drive? Absolutely. Obtaining car insurance is mandated by law as a form of protection for you or another person should an accident happen that might cause damage to properties and physical injuries. This is one form of financial responsibility that each driver must face.

The proof of insurance is a record that indicates how you have met the requirements of the state for vehicle insurance. There are different requirements for every state, but generally speaking, all states actually require that you present a proof of this financial responsibility.

People who own and drive vehicles cover their liability with a policy for insurance. The most common proof of insurance would be the card that the insurance company gives you after signing up for coverage.

In other states, there accept other forms of proof of insurance. Some look for the electronic database where your information about your coverage is being sent by the insurance companies. However, even if your state can check the proof of your car insurance through the electronic database, you must always keep your insurance card with you or inside your vehicle at all times.

On the other hand, if you are thinking whether you do need proof of auto insurance and you do not wish to purchase a policy, some states actually do allow the people to prove their financial responsibility in other ways. One way is for you to make a large deposit with the state treasurer. The amount is different for every state. It can run from $25,000 to $100,000.

Another way to do it is to get surety bonds to demonstrate financial responsibility. This will also prove compliance with the state auto insurance law. This bond is a way so that the owner of the car or the driver may show that they can shoulder the liability coverage and other protection means that the state requires if you ever encounter an accident. However, this option is not available in all states.

This procedure involves buying a bond in the same required amount of the minimum combined liabilities of the state. Motorists are only required to put down a particular percentage of the actual bond value while still keeping present the cash flow higher. You must look at your state insurance department site to make sure if this option is available on your state. Make sure to always keep that certificate of your deposit or bond with you to prove your financial responsibility.

Proof of insurance is very important especially on instances that you will need to show it. One of the instances is when you put up your vehicle for registration. Another time that you would need to show this proof is when you are in an accident. You will also need to show this if you get pulled over by an officer for some traffic violations.

Not being able to show this proof of financial responsibility will lead to some consequences. You will definitely get penalized for not have this proof of insurance with you should the situation call for it. A fine would have to be paid in case you get caught not having the proof of insurance with you. Another possibility is that your license and registration might get suspended. In some cases, motorists caught without this proof might also spend some jail time as penalty for this shortcoming. If you want to reinstate your license or your vehicle registration, then you can present the proof of insurance in the form of an SR-22.

The answer to the question, "Do you need proof of auto insurance," is a big yes. That is why you need to make sure that you have it with you at all times.