What you need to know about minimum car insurance coverage requirements in Arizona and other auto insurance basics
According to the Arizona Department of Transportation (ADOT), Arizona is one of the most dangerous places to drive a car. In 2017, there were 127,064 car accidents (919 of which proved fatal).
Nevertheless, Arizona has some of the most lenient car insurance coverage requirements in the country. Insurance premiums in Arizona are also relatively low— about $1,355 per year on average.
Let’s take a closer look at Arizona’s auto insurance system, minimum coverage requirements, and what to do if you get into a car accident with an uninsured driver in the Grand Canyon State.
Fault-based insurance system
Arizona has a fault-based insurance system. This means that the person responsible for causing a car crash is also responsible for paying for the damages.
This is different than a no-fault insurance system in which all drivers in an accident, no matter who is responsible, turn to their own insurance policies to cover the damages (such as in Florida).
In Arizona, a person who suffers an injury due to a car accident caused by another driver has three options:
- File a claim with their own insurance company (in this situation, the insurance company will turn around and pursue reimbursement from the at-fault driver’s insurance company)
- File a third-party claim directly with the at-fault driver’s insurance company
- File a personal injury lawsuit in civil court against the at-fault driver
Mandatory auto liability insurance
Liability insurance covers bodily injuries and property damage caused by the insured individual and sustained by someone other than the insured. In other words, if you cause a car accident, your liability insurance pays for the other person’s injuries and damages.
The required minimum amounts of liability coverage in Arizona are:
- $15,000 for bodily injury or death of one person in an accident
- $30,000 for total bodily injury or death in an accident (i.e., for all persons harmed in one accident)
- $10,000 for property damage per accident
All vehicles registered in Arizona must be insured by a company licensed to do business in Arizona.
Penalties for being uninsured
Failure to maintain the required liability insurance can lead to fines and suspension of your vehicle registration and/or driver’s license. Reinstating these privileges can be expensive and time consuming.
On top of that, if your license or registration is suspended in Arizona, you may not be able to obtain a license in another state. You may also be prevented from obtaining insurance in another state.
What happens if the other driver doesn’t have liability insurance?
Despite the fact that liability insurance is mandatory in Arizona, an estimated 12% of drivers in Arizona are uninsured.
So what happens if you’re involved in an accident and the other driver doesn’t have insurance?
Let’s look at these options more closely:
- Uninsured motorist (UM) coverage: provides coverage for bodily injury and property damage sustained by you or the passengers in your vehicle as a result of an accident involving an uninsured driver
- Underinsured motorist (UIM) coverage: provides coverage for bodily injury and property damage sustained by you or the passengers in your vehicle as a result of an accident involving a driver who has insufficient insurance to cover the damages
If you don’t have UM or UIM coverage, you have the option of suing the driver. You can also sue the driver for any amount of damages you sustain in excess of the applicable policy limits.
The problem with suing an uninsured driver is that a driver who doesn’t have money to purchase insurance generally doesn’t have money to pay a judgment. Regardless, there are a number of legal tools an attorney can use to collect money from a defendant and you should speak to an attorney about your options.
Optional car insurance coverage in AZ
While your liability insurance covers damages sustained by other people involved in an accident, it doesn’t cover your damages. Even in cases when you didn’t cause an accident, it can take a long time to receive money from the at-fault driver.
In these situations, you would benefit from having a policy that covers your damages regardless of who caused the accident. Fortunately, there are a handful of these optional coverage policies available in Arizona, including:
- Personal injury protection (PIP) coverage: provides up to $10,000 in coverage regardless of who’s at fault (what’s covered depends on the specific policy)
- MedPay coverage: provides coverage for medical expenses incurred by you and your passengers regardless of who is at fault
- Comprehensive coverage: provides coverage for losses other than those caused by a collision (vandalism, falling objects, fire, etc.)
Have more questions about your rights in a car accident case in Arizona? An Arizona personal injury lawyer can help. If you have questions about your auto insurance policy, we recommend contacting your insurance provider.