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New York takes car insurance seriously — all drivers are required to show financial responsibility before hitting the road or even registering their cars. Buying car insurance with liability and no-fault coverage is a common way to fulfill that responsibility, but you can instead choose an alternative coverage option.
Proof of coverage in New York
When you register your car with the New York DMV, you will need to present a valid New York state insurance ID card. This will be matched to the digital record on file. If you're pulled over on the road, you can show a paper or electronic version of your insurance card to prove coverage.
Here's what a minimum auto insurance policy includes:
New York required car insurance coverage
|Required minimum limits|
Bodily injury (BI)
|$25,000 per person/$50,000 per accident|
Property damage (PD)
|$10,000 per accident|
Basic personal injury protection (PIP)
|$50,000 per accident|
Uninsured motorist bodily injury (UMBI)
|$25,000 per person/$50,000 per accident|
New York car insurance minimum requirements
The easiest way to satisfy New York's financial responsibility law is by purchasing a car insurance policy. But keep in mind: Getting just the minimum coverage limits can help you save on car insurance, but you'll be more exposed to the financial risks of an accident. Here's a look at what minimum coverage offers along with optional insurance:
Bodily injury (BI): If you cause a car accident, this coverage pays for the other party's medical bills and car repair expenses, up to $25,000 per person or $50,000 per accident. Insurance companies say most people in New York choose to raise their limits to 100/300, but this varies by insurer and depends on your needs. When selecting your limits, consider whether your assets would be vulnerable to lawsuits following an accident. Some drivers raise their coverage limits to match their net worth.
Property damage (PD): This coverage pays for any property damage you cause in an accident, up to $10,000 per crash. Together with BI, these two coverages are known as liability insurance, which means they pay out to the other party when you cause an accident. Higher limits are available for PD as well, but they vary by insurer.
Personal injury protection (PIP): Also known as no-fault insurance, PIP helps pay for your own medical bills following a car accident — regardless of who's at fault — up to $50,000 per accident. Medical expenses typically include hospital visits, psychiatric care, physical therapy, rehabilitation and long-term professional health services.
If you're unable to work because of your injuries, you are also entitled to 80% of your lost income, with a $2,000 monthly cap, for up to three years. You'll also receive a daily stipend of $25 to cover necessary household expenses for up to a year following the accident. And if you die in the accident, PIP coverage pays your beneficiary up to $2,000 for funeral expenses.
You can raise your PIP limits, but it's considered a separate optional coverage and called "additional PIP" or "medical payments" (more on that below).
Uninsured motorist bodily injury (UMBI): As its name implies, this type of coverage kicks in when you're hit by an uninsured driver. It pays for your injuries, up to $25,000 per person and $50,000 per accident, for any accidents that occur within New York state. Pay attention to the limits; if your coverage exceeds 25/50, then it may be considered supplementary UMBI and could cost more.
In addition to raising your limits on the required portions of your policy, you can also increase your protection by buying extra types of coverage — such as collision and comprehensive. Here are a few to consider:
- Additional PIP: This type of coverage allows you to raise your PIP limits by either $50,000 or $100,000 per accident.
- Optional basic economic loss (OBEL): If you want even more PIP coverage, then OBEL allows you to add another $50,000 to the PIP limit.
- Medical payments: Sometimes referred to as residual MedPay by New York insurers, this coverage pays for the medical expenses and funeral expenses, if needed, for you and any of your passengers who do not have their own auto insurance policy.
- It's first-party coverage, so MedPay will cover you and your passengers up to the limit you purchase, regardless of who was at fault. Limits range between $500 and $2,000 and vary by insurer, but some drivers find this coverage redundant with their health insurance and other first-party coverage.
- Supplementary UMBI: This provides extra UMBI protection on top of the mandatory 25/50 minimum through higher coverage limits — typically up to 250/500, depending on the insurer. It also extends to out-of-state accidents involving an uninsured motorist. Keep in mind: Your supplementary UMBI coverage limits may never be higher than your BI limits.
Your right to sue
In New York, drivers are limited to suing for quantifiable economic losses following a car accident, so they won't be able to sue for pain and suffering (referred to as noneconomic loss). However, if you're suffering from a "serious injury" after an accident that someone else caused, you may be able to get an exception to this limitation. Here is the list of what may be defined as "serious injury" under New York's no-fault law:
- Significant injury such as a fracture (complete or partial break of a bone) or an injury that will prevent you from doing your daily activities. A doctor will need to determine whether it will take you more than 90 days to recover.
- Significant disfigurement
- Permanent injury such as a permanent limitation in the use of a body organ or parts of your body.
- Significant/permanent disability such as permanent loss or significant limitation in the use of a body part or body organ, body function or body system.
- Loss of a fetus
Alternative proof of financial responsibility
If you decide against getting an auto insurance policy (or you're unable to), there are three other ways to satisfy the required financial responsibility under state law. Under these alternatives, your proof of insurance will be a certificate or form of insurance ID card issued by the commissioner of the department of motor vehicles. Here are the alternatives:
- Security deposit with the DMV: You may choose to deposit $150,000 — as cash or security — which can be used to satisfy claims or judgements against you following an accident. If the commissioner believes the deposit isn't enough to satisfy the insurance requirement, they may ask you to submit additional deposits.
- Surety bond: You may also choose to file a surety bond with the DMV, as long as it's issued by a New York-licensed surety company. The commissioner will decide whether the bond meets state standards and issue a certificate. With a surety bond, you pay for any claims resulting from an accident — but if you can't, then the surety company will pay in your place and collect from you later.
- Self insurance: When you own and have more than 25 cars registered under your name, you may be able to apply to become a self-insurer. Apart from providing all documents that the commissioner requires to prove your financial ability, you will have an annual fee to pay for each car listed under your self-insurance. The commissioner will issue you a certificate once they believe you're able to pay out for accident claims for every vehicle as would a minimum liability policy.