How Car Insurance Works in New York State

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Car insurance is mandatory across most of the United States, but the exact regulations vary on the state level. This article is for drivers in the state of New York. If you registered your vehicle elsewhere, the information below may not apply to you.

The state of New York mandates that drivers carry multiple types of insurance, including liability protection, Personal Injury Protection (PIP), and Uninsured Motorist Bodily Injury Coverage (UMBIC). Any policy that does not meet minimum coverage requirements in one or more of these categories is not valid auto insurance in New York State.

There are three thresholds that liability protection must meet. First, you must buy at least $25,000 in personal liability coverage per person. You must also carry $50,000 in personal liability coverage per accident. Finally, you must have $10,000 of property damage liability insurance per accident.

The state also mandates at least $50,000 of PIP coverage. The primary benefit of this coverage is that it pays for medical bills and/or lost wages regardless of who was “at fault” for the auto accident responsible for the injuries. This allows rapid payment, while other benefits are often subject to some legal proceeding before getting dispersed.

Finally, there are two minimum thresholds that UMBIC coverage must meet. First, $25,000 is the required coverage level per individual. Second, $50,000 is the required coverage level per accident. This insurance protects you from any liability if you become injured by an uninsured driver driving illegally.

These minimums are just minimums, and individual drivers may choose to carry more coverage in any of the categories above while remaining in full compliance with New York State law. If you ever find yourself in need of a settlement for car accident injuries, the higher premiums associated with more comprehensive coverage options may be worth it to you.

While they mandate auto insurance in New York, private sellers sell it under no legal obligation to insure any driver. If a legal New York driver cannot buy auto insurance, or they cannot do so at a fair price, that individual may qualify for the New York Automobile Insurance Plan (NYAIP). This program is jointly administered by the state’s government and a nonprofit organization called AIPSO.

In general, drivers must prove that they sought qualifying auto insurance on the private marketplace for at least 60 days before resorting to NYAIP coverage. The program’s website is the best place to learn more about this coverage’s eligibility requirements and application procedures.

In conclusion, it is illegal to drive in the state of New York without a certain minimum of auto insurance protection. Qualifying policies must meet minimum thresholds of coverage in liability, PIP, and UMBIC protection. Any drivers who cannot find a qualifying policy may get one through the NYAIP.

Sources

  1. https://www.aipso.com/Plan-Sites/New-York
  2. https://www.nerdwallet.com/blog/insurance/cheapest-car-insurance-in-new-york-ny/