Happy New Year: 2011 Brings Good News To Texas Car Wreck Victims

What good news could there be for victims of car wrecks? 

It’s all about insurance.

Beginning January 1, 2011, all new Texas auto insurance policies will require higher minimum limits.  What does this mean to auto accident victims?

In many cases, it will mean more financial compensation to put the victim a little bit closer to being fully compensated for his or her injuries.

The limits of insurance are the maximum amount that an insurance company may have to pay out for any wreck, regardless of how bad the victim of the wreck is hurt.  Currently, the minimum bodily injury limits that drivers are required to purchase are $25,000 per person or $50,000 per accident. 

The “per person” limit means that in any wreck the most that the insurance company will ever have to pay an individual for the individual’s injuries sustained in a wreck is $25,000, regardless of how bad the individual is ever hurt.  If the injured victim has $25,000 in damages, then the insurance company is required to pay the $25,000.  But if the injured victim has $50,000 or $100,000 in damages, the insurance company is still only required to pay the $25,000 limit of its insurance.

And the “per accident” limit means that the most the insurance company would ever have to pay out for any one wreck, regardless of the number of individuals injured in the wreck, is $50,000.   If three people are injured in a wreck, and each have damages of $25,000, then the insurance company only has to pay $50,000 total, and someone has to work with the injured victims to allocate those funds.

Effective January 1, 2011, the minimum limits for all new policies in Texas will be raised to $30,000 per person and $60,000 per accident.    That change is significant.  The $5,000 difference (a 20% increase) in many cases will make the difference between the victim being able to recover full compensation for medical expenses or lost wages. 

This benefit also protects at fault drivers.  In addition to the injury limits going up, the property damage limit will also be increasing.  As the prices of cars and car repairs increase, the increase limits will provide additional protection for drivers who are involved in wrecks that hurt another vehicle, but not another person. 

And the cost for this benefit is small.  Insurance industry experts suggest that the increase cost of rates will be miniscule, if rates increase at all.

So this is a great change for all Texas drivers that will provide additional protection for all of us.