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Hello! I'm Dan Lyles with Lyles Insurance. And in this video, we're going to answer a frequently asked question: What is an Ohio SR22 bond?
So what is an Ohio SR22 bond? I'm sure many of you have heard that term “SR22 bond” or “SR22 insurance”. The fact is they're both misleading terms. An SR22 is not a bond, nor is it auto insurance either. It's simply a state filing that attaches onto either a regular auto insurance policy or an Ohio financial responsibility bond.
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 is what I call a “tattletale” ….. 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 I want to go over what an Ohio financial responsibility bond is. It's important that you understand that a financial responsibility bond is a special type of auto insurance policy that's designed for drivers who need auto insurance, but don't own a vehicle. And they're usually a lot cheaper than regular auto insurance. And the reason is because of the coverage. You'll see there, it offers state minimum liability coverage and nothing else. There are five major parts to a regular auto insurance policy. The bond will only cover you for one of those five, and that's at state minimum levels. And another thing, unlike regular auto insurance, coverage is only available for one driver. And that's the person named on the bond.
It's important that you set up your SR22 filing properly. And it's very easy to do: 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. And if you don't own a vehicle, then you just need to take out a Financial Responsibility Bond and again, the SR22 filing attaches onto it also. Now here's where the mistake is made: A lot of vehicle owners will settle for a financial responsibility bond instead of regular auto insurance because of the price. Or because they're driving record is so bad they can't afford regular auto insurance. I get it and I understand. But you need to understand that from a coverage standpoint this is a bad idea! And I'm going to explain why on the next slide.
There are three major reasons why it's a bad idea to settle for a financial responsibility bond when you own a vehicle. Number one, state minimum liability level sucks for a vehicle owner! They’re good for a minor accident. But if you cause a serious accident with injuries, it's not going to be nearly enough coverage. Number two, as I mentioned before, you're missing four out of five major parts to an auto insurance policy: medical coverage, uninsured motorist coverage, comprehensive coverage, and collision coverage. All four of those are not offered on a bond. And number three, you can never allow anyone else to drive your vehicle with just a bond because it only covers one driver (the person named on the bond). This is where a lot of vehicle owners get into trouble. If you're only carrying a bond and you loan your vehicle out to somebody and they get pulled over, you're probably going to get in trouble. If they get in a major accident, then you're going to be in big trouble.
Not all auto insurance companies will write SR22 filings and sell financial responsibility bonds. And of the companies that do, a lot of them charge an arm and a leg for SR22 filings. So your best bet is to find an independent agent who specializes in high-risk auto insurance. They carry multiple SR22 friendly companies to shop around for a lower rate.
If you'd like more information about SR22 filings, I've included some links for my website put on here. Got a page for my SR22 auto insurance, just gives you a little more general information. Or if you'd like for me to run you a quote personally, I've also included links for both vehicle owners and non vehicle owners. I've also included all of these links at the bottom, if you need to click on there. And also, if you'd rather just give me a call, I've also listed my phone number. Thanks for watching. And have a great day!
Dan Lyles is an Independent Insurance Agent serving Ohio, Indiana, Michigan, Pennsylvania, Virginia and West Virginia..