In the coming year, Texas drivers will see a 2-3 percent increase in their automotive policy rates in order to cover additional liability limits mandated by a law passed in 2007.
The Texas Legislature took the action in 2007 in an effort to address the rising level of medical costs associated with auto accident claims. Approximately 7 million Texans will be affected by the rate increase.
Under the current law, a driver must carry $25,000 injury coverage; $50,000 accident coverage; and $25,000 property damage coverage per accident. Now the minimum limit will increase to $30,000 per injured person; and $60,000 for each accident with the property damage minimum remaining unchanged.
The rate and coverage increases will not become active immediately on January 1, but will be activated when any given policy is renewed in 2011, amounting to a gradual phasing in of the new minimums.
It is estimated that only half of insured drivers carry both liability and collision coverage, especially during tough economic times when a liability policy may well be all they can afford.
Increasingly drivers are turning to online insurance shopping options, in particular price comparison engines, to find better rates. Drivers in Texas should not simply allow their coverage to renew automatically this year, but should weigh their options for keeping their premiums as low as possible in the face of new, legally mandated coverage minimums.