Transcript – Ohio SR22 Bond
Hello! I'm Dan Lyles with Lyles insurance. And in this video I'm going to go over the basics of an Ohio SR22 bond, and also answer some frequently asked questions.
Right off the bat, I want to clear up some of the confusion about an “SR22 bond”. It is a misleading term. You may also have heard “SR22 bond insurance” before also. Again, it is misleading. An SR22 is not a bond, nor is it auto insurance. It's a state filing that either attaches onto an auto insurance policy or a Financial Responsibility Bond. That's where the confusion comes from, with the term “SR22” bond. Ohio is the only state that has these type of bonds. So, Ohio is the only place you hear this “SR22 bond” term. It's usually what an SR22 does, is when your license is suspended. It's the last step you'll need to get your license back.
Here's the good part about what an SR22 filing does for you. When you buy an auto insurance policy or a Financial Responsibility Bond that has an SR22 attached to it, the auto insurance company notifies the Ohio BMV that you have taken out an active SR22 filing. This SR22 is a guarantee to the BMV that you're carrying at least state minimum liability auto insurance coverage. Once the BMV processes your SR22 filing, your license will be reinstated (assuming you've paid all other fines and met all other requirements).
Now here's the bad news about an SR22 filing. The easiest way to understand it is what I call a “tattle-tale”. You need to keep this SR22 active for as long as the BMV requires you to carry it. And if you ever cancel on a policy or drop the SR22, the auto insurance company is required by law to tattle on you. That is, notify the BMV that the policy is canceled. Once this happens your license is going to be suspended again until you have another active SR22 filing in place.
Now let's go over the basics of an Ohio Financial Responsibility Bond. It's simply a special type of auto insurance coverage. It gives you state minimum liability on any vehicle you drive (as long as you're not using it for business or commercial purposes). The only coverage that it offers is state minimum liability coverage and nothing else. And it's designed much like a named operator's policy or non-owners policy. It's for people who need auto insurance but don't own a vehicle.
Here are some other key points about a financial responsibility bond. Unlike regular auto insurance, there is no medical coverage offered. There is no uninsured motorist coverage offered. There is no Comprehensive or Collision coverage, which is the actual coverage on the vehicle you're driving. And unlike regular auto insurance, which can insure several drivers on one policy, a bond only covers one driver. And that's the person named the bond. It is the absolute minimum that you can buy and drive legally in the state of Ohio.
This part is very important. You need to know how to set up an SR22 filing properly. And it's very simple. If you own a vehicle or have a vehicle registered in your name, you simply need to take out a regular auto insurance policy, and attach the SR22 filing on to it. If you do not own a vehicle, you need to take out a Financial Responsibility Bond, and attach the SR22 filing onto it.
Now I want to answer some of the more frequently asked questions. I think it will give you a better understanding of how this works. Number one: How do I file an SR22 with the state
BMV? It's real simple. You can do one of two things: Number one, simply do nothing. Because once you buy a policy, the auto insurance company is going to file that SR22 electronically to the state. Usually that's done within a matter of minutes or an hour two at the most. It's done really quick. The slow part is waiting for the BMV to process it, which usually takes one, sometimes two business days. Now if that's not fast enough for you, your second option is to take the SR22 paperwork in to the BMV yourself, and have them process you all right there on the spot. Your agent will be able to give you all the paperwork you need. They can email it or fax it to you if need be. But either option will work.
Number two: How long do I need to carry an SR22 filing? That's going to vary depending on what your license was suspended for in the first place. But for the most of you, it's going to be a period of three years. And it is very important, I want to add, that you know the expiration date of how long you need to carry that SR22. Because people been burnt by not knowing it. Number three: Can I buy an SR22 attached to an auto insurance policy while my license is still suspended? The answer is yes. Because they understand that until you have this SR22, your license can't be reinstated. So you can get a policy with an SR22 and your license still suspended. However, it is with the understanding that you're going to be getting your license reinstated very quickly. And by very quickly, I mean only a matter of a couple days. So you don't want to start this until you're ready to get everything settled.
Number four: Can I purchase two separate policies, one for auto insurance coverage to insure my vehicle, and a financial responsibility bond just to satisfy an SR22 requirement? And the answer is yes. Yes, you can. In fact, on rare occasions I have suggested people do this. Especially those who own their own home and have their homeowners and auto insurance bundled together. Sometimes it comes out better to have two separate policies. However for nine out of ten of you, and the vast majority of you, it's going to come out cheaper to just have everything on one regular insurance policy with the SR22 attached to it.
Number five: This is for drivers who own their own vehicle. But instead of buying regular auto insurance coverage like they should, they buy a Financial Responsibility Bond instead. Now, legally this is okay to do. But I'm telling you, it's a very bad idea! Number one, state minimum liability coverage sucks! It's only going to cover you adequately for a very minor accident. It's not going to be enough if you cause a severe accident with injuries. Number two, a bond only covers the person named on the bond. So if you loan your vehicle to anybody else, they're driving your vehicle illegally. And if they wreck your car, they're going to come after you! I've seen quite a few drivers get in a lot of hot water over this. And number three, there's important coverages regarding auto insurance coverage that aren't offered on a bond. They include uninsured motorist coverage, medical payments coverage, and if you have a newer or more valuable vehicle, comprehensive and collision coverage. So you would have to go without all of those with the financial responsibility bond. And again…. Just don't do it! Don't do it. Don't do it. Don't do it!
Number six: Where do I find the best rate? You've probably learned that many auto insurance companies won't write SR22 filings. And many don't offer Financial Responsibility Bonds. So it's a little trickier looking around. The best way is to simply go through an independent agent who specializes in non-standard auto insurance (it's also known as high-risk insurance). Those companies are friendly with SR22 filings. And an independent agent can quote you with multiple companies at once, which gives you a chance at a better rate. If you'd like to get a quote, click on the link below on my website and I'll be happy to run a quote for you. And as always, I handle all quotes personally and privately. I hope this has taught you what you need to know about SR22’s and Financial Responsibility Bonds. Thanks, and have a great day!
Dan Lyles is an Independent Insurance Agent serving Ohio, Indiana, Michigan, Pennsylvania, Virginia and West Virginia..