NY Car Insurance Laws Every Driver Must Know

New York Minimum Car Insurance Requirements
New York mandates all drivers to carry liability coverage, personal injury protection (PIP), and uninsured/underinsured motorist coverage. Minimum requirements include:

• Bodily Injury Liability: $25,000 per person / $50,000 per accident.
• Death Liability: $50,000 per person / $100,000 per accident (if someone dies).
• Property Damage Liability: $10,000 per accident.
• PIP (No-Fault Insurance): $50,000 per person for medical expenses, lost wages, and essential services.
• Uninsured Motorist Coverage: $25,000 per person / $50,000 per accident for bodily injury.

Drivers must provide proof of insurance via a DMV-issued NY Insurance ID Card when registering a vehicle, during traffic stops, or after accidents. Electronic proof (e.g., smartphone display) is legally accepted.

No-Fault Insurance: How It Works in NY
New York operates under a “no-fault” system, meaning your insurer pays for your economic losses (medical bills, lost earnings) regardless of who caused the crash. This streamlines claims but restricts lawsuits unless injuries meet the “serious injury” threshold (e.g., fractures, disfigurement, or permanent disability). PIP covers:

• Medical treatments (doctor visits, surgeries, rehab).
• 80% of lost wages (up to $2,000/month for three years).
• $25/day for other expenses (e.g., household help).

Penalties for Driving Without Insurance
Driving uninsured in NY carries severe consequences:

• Fines: $150–$1,500 for first-time offenses.
• License/registration suspension: Up to 3 years.
• Reinstatement fees: $750–$900.
• Vehicle impoundment.
• Jail time (up to 15 days for repeat offenders).

Uninsured/Underinsured Motorist Coverage (UM/UIM)
NY requires UM/UIM coverage to protect you if an at-fault driver lacks insurance or has insufficient limits. UM/UIM pays for:

• Medical expenses exceeding your PIP limits.
• Pain and suffering (if injuries meet the “serious injury” standard).
• Policy stacking (combining limits for multiple vehicles) is not permitted in NY.

Liability Coverage: Protecting Others’ Expenses
Liability insurance covers costs if you injure someone or damage their property:

• Bodily Injury: Covers medical bills, legal fees, and settlements for others.
• Property Damage: Repairs/replaces other vehicles, structures, or belongings.
  NY’s minimum property damage limit ($10,000) is often insufficient for multi-car crashes or luxury vehicles. Experts recommend $100,000+ to avoid personal liability.

Optional Coverages for Enhanced Protection
While not mandatory, these add-ons are advisable:

• Collision Coverage: Repairs your vehicle after an accident.
• Comprehensive Coverage: Covers theft, vandalism, weather damage.
• Additional PIP: Raises medical/lost wage limits beyond $50,000.
• Gap Insurance: Pays the difference between your car’s value and loan balance if totaled.

Insurance Requirements After a Lapse
Drivers who let coverage lapse face immediate registration suspension. To reinstate, they must:

• Purchase a new policy.
• File an FS-1 form (proof of insurance) with the DMV.
• Pay a $8–$10 civil penalty.
  Repeat offenders may need an SR-22 certificate (proof of high-risk insurance) for three years.

New York’s Comparative Negligence Rule
NY follows a “pure comparative fault” model. If you’re partially at fault for an accident, your compensation is reduced by your percentage of blame. For example, if you’re 30% responsible for a crash with $100,000 in damages, you can recover $70,000.

Reporting Accidents in NY
State law requires drivers to:

• Report crashes to police if injuries, deaths, or property damage exceeds $1,000.
• File Form MV-104 (Accident Report) with the DMV within 10 days for injuries/deaths.
• Notify your insurer immediately—even for minor accidents. Delaying may result in claim denial.

Discounts and Cost-Saving Strategies
NY has the 8th-highest average premiums nationally ($2,471/year). Lower costs by:

• Bundling auto and home insurance.
• Maintaining a clean driving record (3+ violation-free years).
• Using telematics programs (e.g., Drive Safe & Save™) for safe-driving discounts.
• Increasing deductibles (if financially feasible).
• Comparing quotes every 6–12 months.

Special Cases: Rideshare and Leased Vehicles

• Rideshare Drivers (Uber/Lyft): Must carry commercial insurance. NY requires rideshare companies to provide $1.25M liability coverage while transporting passengers.
• Leased Cars: Lessors typically require higher liability limits ($100k/$300k) and comprehensive/collision coverage.

Fraud Prevention and Penalties
NY aggressively targets staged accidents and false claims. Penalties include:

• Felony charges (up to 7 years in prison).
• Fines up to $15,000.
• Permanent criminal record.
  Report suspected fraud to the NY Department of Financial Services.