If you are carrying an Ohio SR22 financial responsibility bond, you may be a bit surprised to see your rate go up upon renewal. That is because the new state minimum law went into effect December 22, 2013. Any bond or regular auto insurance that only carried the old state minimum limits must be increased if the policy renewed on or after that date.
However, with most of the changes I've seen the increase in premium have only been very minimal. By minimal, I mean usually 10% or less. If your SR 22 bond increased by any more than that, then it may be time to shop around for a cheaper rate. Because there are plenty of companies who are only increasing the rate by pennies on the dollar.
Is this minimum coverage increase a one time thing, or will it continue to increase in the future?
That is a great question. Obviously, I don't know the answer to that. That is up to Ohio lawmakers. But if the past is any indication of the future, you will probably not have to worry about another increase for a long time. I'm 41 years old. And when these old state minimum levels were set, I wasn't born yet. So this is the first increase that's happened in my lifetime.
How much does liability coverage increase with the new state minimum limits?
The new state minimum limits are double what the old limits were in terms of bodily injury. And they are more than triple the old coverage in terms of property damage.
Old Minimum: 12.5/25/7.5
New Minimum: 25/50/25
What the numbers mean: 25/50, the first two numbers represent the maximum your liability coverage would pay in thousands if you were at-fault in an accident and injured someone or multiple people. The first number ($25,000) is the most any one person could collect from their injuries. The second number ($50,000) is the most that it would pay in total for multiple injuries. The third number ($25,000) represents the total your liability coverage would pay for property damage.
Am I to assume that this new coverage minimum level is adequate?
No! Keep in mind that Ohio had one of the lowest levels of state minimum coverage in the country. This increase simply upgraded Ohio from the category of very lousy to just lousy. The reason is because it will only protect you for minor accidents. It will not sufficiently cover you if you're at fault in a serious accident. It only takes a couple days in the hospital to exceed $25,000.
So, for those of you who have financial responsibility bond, which are only offered at state minimum liability levels, you might want to change the type of policy in order to get higher coverage. The best way to do this if you do not own a vehicle is to get a named operator's policy or a broad formed name driver policy. Not only will this offer you higher levels of liability coverage, but it will also offer you medical payments and uninsured motorist coverage. Both of which are not offered with financial responsibility bonds. And just like regular auto insurance or financial responsibility bonds, both of these types of policies can attach your SR22 filing onto them.
Summary: Don't sweat it because the state minimum went up. The increase is only very minimal. And if you've seen an increase more than just minimal, it's either because another changing factor caused your premium to go up, or your company is simply not competitive pricewise with the new increase. If it's the latter, then you may need to shopping around for lower rates.
Get an SR22 quote here if you own a vehicle.
Get an SR22 quote here if you do not own a vehicle, and want the lowest possible rate.
Get an SR22 quote here if you do not own a vehicle, but want higher coverage levels.
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Dan Lyles is an Independent Insurance Agent serving Ohio, Indiana, Michigan, Pennsylvania, Virginia and West Virginia..