Surprised? Most people are, but there is a big catch. Texas law states that a person may not operate a motor vehicle unless financial responsibility is established for that vehicle. Car Insurance is only one way you can show financial responsibility. Here are all of the ways you can show financial responsibility:
1. A motor vehicle liability insurance policy with limits at least $30,000 per person for bodily injuries, $60,000 per accident for bodily injuries and $30,000 for property damage
2. Filing a surety bond with the state for the same amount that is required for liability insurance.
3. Depositing $55,000 in cash or securities with the state or county where the vehicle is registered
4. Self-Insurance – If you own more than 25 motor vehicles you may qualify as a self-insurer by obtaining a certificate of self-insurance from the state
So yes, car insurance is not required in Texas, but proving financial responsibility is. Most of us are not able or willing to take a financial risk by not having car insurance. After all, Texas is one of the most litigious states in the union. Just looking at the number of tv ads and radio commercials of car wreck lawyers will tell you that it’s a good idea to have car insurance in Texas. But, it’s even more important to have the appropriate liability limits on your car insurance policy.
The state minimum liability limits for Texas is $30,000 per person for bodily injuries, $60,000 per accident for bodily injuries and $30,000 for property damage. You are personally liable for all medical expenses and property damage that exceeds your car insurance policy limits. So, assuming you have state minimum limits and have an at-fault accident with a $40,000 car, you will be personally liable for $10,000. Furthermore, if there are multiple passengers in the vehicle and their medical bills are $100,000, you will be personally liable for an additional $40,000. If you don’t have an extra $50,000 laying around to satisfy a car wreck judgment, I would recommend increasing the limits of liability on your car insurance. Our agents always recommend a minimum of $100,000 per person for bodily injuries, $300,000 per accident and $100,000 for property damage.
Yes, you can drive legally without car insurance in Texas, but it’s not a good idea.
Contact our office for a free car insurance policy review to make sure that you are properly covered.