The Future of Minimum Coverage Auto Insurance for Arizona

You may have had this happen to you. You have an auto accident that is not your fault, you get your car to a body shop for repairs and then you find out that the driver who caused the accident only had minimum required insurance coverage and there is not enough money to pay for your car repairs or injuries?

Will AZ finally raise their minimum required coverage?

What may be good news is the Arizona state minimum insurance coverage could be updated after forty-two years of being the same. The changes proposed by Arizona Rep. Ethan Orr are intended to increase the amount of minimum coverage to match the current costs of repairs and medical expenses. If the legislation passes and the state minimum coverage required goes up, people with minimum liability coverage can expect their rates to go up as well.

Currently the minimum coverage is 15/30/10. Meaning that your insurance will only pay a maximum of $15,000 per person for injuries, and only up to $30,000 per claim (So if three people are injured and the first two people require $15,000 for treatment, the insurance will only pay for the first two, then you would personally liable for the third person if you’re at fault). The 10 means that your insurance company will only cover $10,000 of property damage per claim, property damage includes any damage to the vehicle you hit or damage to buildings, personal property, and anything else damaged in the accident.

The new injury coverage proposed would be $25,000 per person and $50,000 per claim. The property coverage amount doubles to $20,000. With this increase in the minimum coverage, the cost of coverage will go up. The increase in premiums is expected to be $50-$100.

But what does this all mean? Would more coverage be a good thing? Would it make drivers with minimum liability coverage safer on the road? The Property and Casualty Insurance Association of America believes that with the increase in premium costs many drivers with minimum coverage will likely drop their insurance altogether. David Childers, with PCIAA, says that drivers with minimum coverage have only liability coverage because that is what they can afford, and increasing premiums would make insurance unaffordable for those drivers.

Despite increasing the premiums of liability coverage holders, updating the state minimums may still be necessary. Not only has it not been done for over forty years, Arizona is below the nation average in coverage. Updating the minimums would modernize the loss protection as costs for everything continue to rise, and hopefully encourage drivers with liability coverage to drive more safely to get more discounts on their premiums(depending on carrier).

About the author:
Dan Deary is president of Capitol Collision Repair, one of the largest, independent body shops in Phoenix, now in their 25th year in business.

Car Stolen or Damaged? Give us a call to make an appointment 602-253-1630, or Request a FREE estimate.