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State Insurance Minimums: Here's what you need to know

The state of New York takes car insurance seriously — All drivers in New York are legally required to have an auto insurance policy before hitting the road or even registering their cars. So what does this mean for you? We'll explain.

The state insurance minimum requirement ensures the financial protection of the policyholder from expensive medical bills and property damage expenses and is legally required in order to drive within the state. Without it, drivers in New York are at risk of receiving penalties or fines.

How much car insurance you need in New York depends on factors unique to you, but your policy should at least meet the state’s minimum requirements in order for you to legally drive.

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.


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