With an unusually high uninsured driver rate, ranking 4th amongst states and over 1/5th of the state’s drivers not having auto insurance, it is somewhat surprising that the state’s average auto insurance cost is below the national average. As these averages take a lot into consideration including geographic catastrophes, theft rates, claim rates, congestion that adds to accidents and highway collision rates; there are obvious other factors that are keeping insurance rates lower in New Mexico.
At Fault Insurance
In New Mexico, drivers can litigate to recover damages from accidents in what is termed an at fault insurance system. Essentially the driver believed to be “at fault” as found by a court of law is responsible for the damages of the accident. This insurance system is the most common throughout the US and is also referred to as the Tort system, as it is based on the historical tort law of the US.
However drivers have more than just a civil litigation lawsuit option should they be involved in an accident causing significant damages. Drivers have three other options for recouping these losses including settling privately among the parties, claiming your own insurance company for the damages, or making a third party claim against the at fault driver. In all options, generally the driver thought to be at fault will be negotiating to lessen their burden of payment. In this case if you share any of the blame you also may be found at fault and responsible for a portion of the damages.
Insurance is Required
Although New Mexico does require insurance, it still has one of the highest uninsured rates in the country. This rate however has dropped significantly since 2004 when the state implemented an Insurance Identification Database that tracks drivers, vehicles and their insurance requirements. Prior to this database implementation, the state ranked 2nd in the nation at 30% of drivers being uninsured. This rate is slowly dropping and has dropped 6% over the last decade since the implementation of the database.
In New Hampshire any driver with a registered vehicle is expected to have insurance coverage liability insurance to cover damage, injury and death costs for third party individuals when they are the cause of an accident. This insurance minimum includes $25,000 for the injury or death of a single person, $50,000 for the injury or death of multiple persons in a single accident and $10,000 of coverage against property damage. Even though it has one of the highest uninsured rates in the country it does not require that coverage like a number of other states.
Lastly if the database shows that your insurance has lapsed, or you have registered a vehicle without proper coverage you will be sent a notification stating you need to work with your insurance company to rectify the situation. If you do not have the situation fixed, you can have the registration of your vehicle suspended. There is a $30 reinstatement fee to have your vehicle re-registered once you have the proper insurance coverage.
As an at fault state you may want to ensure that an accident does not result in a catastrophic financial failure because you did not have coverage for your own vehicle. These extra coverages include Collision, Comprehensive, Medical Payments and Towing and Labor coverage. Collision enables you to claim damage against your insurance if your own vehicle is damaged in an accident you were at fault for. While comprehensive coverage deals with theft, vandalism, acts of God such as weather to provide insurance coverage against. Medical payments will help cover the cost of your own medical costs if you happen to get injured in an accident that is your own fault.
State Insurance Coverage
For high risk drivers that have been refused by state insurers, there is always the New Mexico Motor Vehicle Insurance Plan that is a pooled insurance program to ensure that every driver has access to insurance, while also mitigating the risk of high risk drivers across all insurers. The New Mexico plan is part of the Western Association of Automobile Insurance Plans.