New Mexico Auto Insurance
Minimum levels of coverage for New Mexico auto insurance are set by the state. It's up to drivers to educate themselves about the amount of auto insurance they need and the type of coverage that the New Mexico government has decided that drivers should carry.
Rates charged by New Mexico insurance companies for car insurance coverage will vary, so it's a good idea to shop around to get make sure you are getting a good deal on your coverage. Read on to find some tips for finding the cheapest New Mexico auto insurance policy possible while still getting the coverage that you need.
New Mexico Auto Insurance: Required Levels Of Coverage
New Mexico is one of the states that uses the tort system when it comes to resolving auto insurance claims. This means that when an accident happens, a determination is made as to which driver is at fault. That person and his or her insurance company are responsible for paying for injuries and damage to property caused as the result of the accident.
As a driver in New Mexico, you are required to carry 25/50/10 coverage. This means that you need to buy a minimum of $25,000 in Bodily Injury Liability Insurance for an Individual, $50,000 for all people injured in an accident, and $10,000 in Property Damage Coverage.
New Mexico Auto Insurance: Bodily Injury Liability Insurance
Bodily Injury Liability Insurance pays for an injured person's medical expenses following an accident. This type of coverage also compensates an injured person for his or her lost wages.
Since New Mexico is a tort state, this type of insurance will cover the costs of defending a law suit started by an injured person for pain and suffering. The insurance company will pay to settle the claim or a judgment made in the legal action up to the policy limit you select.
If you choose to buy only the legal minimum in bodily injury coverage and you are the at fault driver in an accident, you will be responsible for any damages over your policy limit. Consider for a moment how far $25,000 or $50,000 in insurance money will go if someone has gets hurt. It likely wouldn't go very far if someone needed to be hospitalized for a time to recover from their injuries, whether they needed to have surgery or not.
A better choice would be to look at the amount of coverage you will need to protect your assets and buy the right level of coverage for that purpose. You don't want to be faced with having to use your savings and possibly liquidate your assets to pay for an injury claim.
New Mexico Auto Insurance: Property Damage Coverage
The minimum $10,000 in property damage coverage will be used to pay for the cost of repairing damage to the other driver's vehicle, as well as property such as fences, sheds, buildings, mailboxes, and street signs. Remember, a legally set minimum does not mean it’s an appropriate amount for your needs. You will need to determine if it is enough.
New Mexico Auto Insurance: Shopping Around For Rates
A good place to start when looking at NM car insurance rates is to find out what the average driver in your state pays for coverage to see whether your rate is higher or lower than the average. If it turns out that your rate is lower, then you may want to stick with the same company. On the other hand, if it turns out that you are paying rates that are higher than average then it may be time to start looking for a different insurance company.
In 2003, the average driver in New Mexico paid $912 for auto insurance coverage. This is in line with the average premium paid in the United States for that year, which was $914. Rates dropped slightly in 2007 by between (0.5-1 percent) and the prediction for 2008 is that rates will again be on the increase.
If you want to get the best possible rate on your car insurance, start getting quotes from other insurance companies a few months before your coverage expires. Compare the level of coverage the company can offer you with the rate they are suggesting you pay. While it may be tempting to go for the lowest rate, if you don't get the level of coverage you need, it's not really a bargain in the long run.
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