Washington Auto Insurance: Tips & Information
Washington Car Insurance
Hello, I'm Shawn. Everyone knows that you have to be exceptionally careful before signing anything, including Auto Insurance.
That's why we've created this special page within the site to advise you on all aspects of buying Auto Insurance. Especially what to look for before purchasing that policy.
Washington Understanding Your Auto Insurance Policy
Your insurance policy is a contract between you and your insurance company. It spells out exactly what the company agrees to do in exchange for the premium that you pay. This contract is divided into two sections: a declarations page and the policy itself.
The declarations page
This section of the policy includes basic details of the agreement. It is important that you review this page to make sure all the information is correct and all the coverages you requested are included. The declarations page includes:
Name of the insurance company
Name(s) of the policyholder(s)
Policy number
Policy period
Description of the vehicle(s) insured
Coverages purchased
Limits of liability and deductibles purchased
Premium charge for each coverage
List of forms that are a part of the policy
The policy
The second part of your insurance contract is the policy itself. This includes:
Insuring agreement
Definitions
When and where coverage applies
Conditions if the vehicle is financed
General conditions
Mutual conditions
Exceptions and endorsements of the policy
Make sure you review your declarations page to verify that your policy includes the types and amounts of coverage you requested.
Types of coverage
There are many different types of coverages available to meet your auto insurance needs. Some are required and some are optional. Here are brief descriptions of the available coverages:
Liability
Washington state requires liability coverage. This covers bodily injury and damage to property that you cause to others while using your car.
Personal injury protection
This covers a limited amount of medical and hospital costs, income continuation, funeral expenses, and loss of services. Coverage limits are defined in the policy.
Medical payments
This covers medical and funeral expenses (not all companies offer this coverage).
Uninsured/underinsured motorist bodily injury
This covers injuries an uninsured or underinsured driver causes to an insured person.
Uninsured/underinsured motorist property damage
This covers property damage an uninsured or underinsured driver causes to your insured vehicle.
Collision coverage
This covers damage to your car that is caused by a collision.
Comprehensive coverage (other than collision)
This covers damage to your car -- except by collision. For example, this covers your car if a tree falls on it or someone vandalizes it.
Emergency road service
This covers towing when your car breaks down.
Car rental expense
If you have a claim that is covered under your auto policy, this coverage pays to rent a car. Be sure to check your policy for any limitations.
Death, dismemberment and loss of sight
This pays for death and certain injuries to people named in your policy due to an auto accident.
GAP coverage
In the event your vehicle is a total loss, this pays the difference between the current market value of your auto and the amount you still owe the lender.
How Do Insurance Companies Set Auto Rates?
When an insurance company wants to change its rates, it must file enough financial and statistical data with our office to prove that the change is justified. Our office tries to hold down rates by carefully reviewing these requests. Last year, we saved consumers more than $45 million compared to the companies' original rate proposals.
As an individual consumer, you may be able to save more. Insurance companies consider many factors when setting auto rates. By understanding how these factors affect your premium and by shopping around, you can save significant money.
How rates are determined
Insurance companies can look at all licensed drivers in the household — including your spouse and other members in your household, even if they're not related by blood. This includes roommates. They calculate rates by starting with a dollar amount (base rate). Your base rate is adjusted according to certain factors such as your age, sex, marital status, driving pattern, claims history, geographical area, credit history and the make, model and year of your vehicle.
Factors insurance companies consider
Your age: Statistics show that drivers under age 25 are involved in more accidents than adults between age 25 and 65. Companies generally consider them to be a higher risk. Families with young drivers in the household may pay more for their insurance. Statistics also show that senior citizens present a higher-than-average risk to insurance companies.
Your gender: Insurance companies can discriminate on the basis of sex if that discrimination is based on statistical evidence, proving one sex is a higher risk. For example, young men — especially those under age 25 — are involved in more accidents and typically pay higher insurance rates.
Marital status: Statistically, married couples have fewer accidents than singles and generally pay lower rates. Your vehicle: Generally, the more expensive your vehicle, the more you will pay for insurance. Also, because sports cars and high-performance cars are involved in more accidents, cost more to repair, and are stolen more often, they cost more to insure.
Your location: Where you live may affect your rates. For example, the local crime rate may boost or lower the base rate for comprehensive coverage. And the base rate for liability and collision coverage may be affected by the average number of accidents in your area.
How much you drive: If you put a lot of miles on your car each year, you'll likely pay a higher rate. Conversely, many companies offer lower rates to people with low annual mileage.
Your driving record and your claims history: Insurance companies may charge you more if you’ve been involved in an accident or have been convicted of traffic violations. And the more claims you file, the more likely your rates will increase.
Credit History: Washington has one of the toughest laws restricting how insurance companies use credit history to set rates. But your insurer still may use information in your credit history to determine your premium.
PIP insurance is
insurance coverage for medical and other expenses, such as wage loss and funeral expenses, which result from an auto accident, no matter who is at fault. The law does not require you to have PIP coverage, but your insurance company must offer it to you.
If you don’t want the coverage, you must reject it in writing. If you don’t reject it in writing, your company must add the coverage and will charge you for it. PIP adds cost to your auto premium. If you have health insurance, consider whether or not you need this extra coverage.
Who PIP covers
PIP covers the person who is named on the policy, household residents related by blood, marriage or adoption, and step- or foster children. It also covers non-family passengers and pedestrians involved in the accident.
What it covers
PIP coverage provides the following minimum benefits:
• Up to $10,000 for reasonable and necessary medical expenses for each individual injured in an auto accident. This is available for up to three years from the date of the accident.
• Up to $200 per week for income replacement coverage. This is limited to one year after a person has been disabled for 14 days after the accident.
• Up to $2,000 for funeral expenses.
• Up to $5,000 for loss of services (payment to others for work you can’t do).
You can buy more coverage. Check with your insurance company or agent.
What's NOT covered
PIP doesn’t cover injuries caused by using:
Farm equipment
Recreational or off-road vehicles
Mopeds
Motorcycles (PIP coverage is available on motorcycle policies)
It also doesn’t cover intentional injuries to the insured person, or if the person is injured in organized racing activities, or while committing a felony.
PIP coverage costs
The cost for PIP coverage varies with each company. Keep in mind, if you choose to buy PIP coverage, the insurance company may require you cover all of the vehicles listed on your policy. The more vehicles on your policy, the more you’ll pay.
Do you need it?
It’s your choice. If you and your family have health insurance, that coverage may pay most of your medical bills, depending on your plan’s limits and copayments. Also, if passengers who don’t live with you rarely ride with you, you may not need the added protection. Discuss your needs with your insurance agent or company representative.
Other options for coverage
Some companies offer coverage for basic medical payments, such as $5,000 for medical treatment only. This coverage is also available no matter who is at fault.
What is the Mandatory Auto Insurance Law?
The law requires anyone driving a motor vehicle in our state to have an insurance liability policy, a certificate of deposit, or a liability bond to the required limits. If you have 26 or more vehicles, you can self-insure. Under the law, you’re required to have a liability policy with limits of at least 25/50/10. This means:
$25,000 for injury to another person
$50,000 for injuries to all other persons
$10,000 for damage to another’s property
You must carry the same limits if you choose to buy a bond instead of an insurance policy. If you use a certificate of deposit, you must deposit $60,000 in cash or securities with the Office of the State Treasurer. If you’re insuring 26 or more vehicles, you can self-insure through the Washington State Department of Licensing.
Proof of insurance
If you’re stopped by a law enforcement officer, you must present an insurance identification card showing that either the vehicle or you are insured.
Your insurance company must provide you with an identification card when they issue or renew your motor vehicle liability policy. At your request, the company will provide a card or temporary proof of insurance for each vehicle covered under your policy.
The insurance identification card must include the name of the insurance company, the policy number, and the policy’s effective and expiration dates. It also needs to include a description of the insured vehicle(s) and/or the name of the insured driver.
If you do not carry proof of insurance and you are stopped by law enforcement, the state considers it a traffic infraction. You will receive a $450 fine that could go on your driving record. The courts could add other fees to your fines, such as a public safety and education assessment, which is 70 percent of all fines.
Some vehicles, including motorcycles, are exempt from the Mandatory Auto Insurance LawSpecially licensed “antique vehicles” over 40 years old
“Collector’s vehicles” over 30 years old
Publicly-owned vehicles (vehicles owned, rented or leased by state, federal, city, county, and town governments, school districts and political subdivisions)
Vehicles registered with the Washington Utilities and Transportation Commission as common or contract carriers (any truck that hauls for payment)
Motorcycles
Motor-driven cycles, such as motor scooters
Mopeds
Regardless of this exemption, all drivers are subject to the state’s Financial Responsibility Law. This law requires the person who is responsible for the damage or injury to pay the loss.