Minimum Coverage Requirements for Ohio Drivers

There are two ways for Ohio drivers to satisfy the state’s minimum requirements to show financial responsibility (FR) before driving a car.

cleveland, ohio - cars drivingOne way is to post a surety bond in a minimum amount of $30,000.

This is an option few people exercise.

The other way is to buy minimum insurance coverage which meets the state’s requirements.

In Ohio, the minimum requirements are as follows:

Bodily injury liability coverage –$12,500 per person or $25,000 per accident

Property damage coverage –$7,500 per accident

Obviously, these limits are not very high. It is very likely that a moderately severe accident could easily exceed $12,500 in medical bills or $7,500 in property damage.

Ohio is a tort liability state, which means that the driver who causes the accident is responsible for all damages, both physical and property.

At these low minimums, it is very possible that an accident could exceed your liability limits, in which case you would be personally responsible for the balance of the damages and would have to pay the difference from your own pocket.

There are a few things to consider when you are purchasing liability insurance in Ohio and deciding at what level you will set your limits. First, do you have property which a lawsuit could require you to liquidate? If your house is paid for or you own your car outright, carrying only the minimum liability amounts is probably not a good idea.

If the damages exceeded these limits, you might be forced to sell your house or car to pay a judgment. On the other hand, if you are renting an apartment and own no real assets, there is nothing for a lawsuit to take, and you could probably get by with lower limits.

Although theoretically a judge could garnish your wages to pay for damages, this rarely happens unless you were very negligent in causing the accident; for example, if you were driving drunk, your insurance might refuse to pay and you could be faced with some severe legal penalties.

If you feel that you are at risk with the minimum liability limits, it is easy to change them. Just tell your agent you want to double or triple your liability limits, and pay the premiums accordingly. Of course, it will cost you more for your car insurance, but this is far better than losing your assets due to an accident which you caused.

The other side of this coin is a situation in which someone causes an accident in which you are involved, and that person has only minimum liability limits.

If it costs more than $7,500 to fix your car, for example, and the person who hits you has only minimum liability coverage and has no assets, you could find yourself facing the unenviable job of paying for part of the damage yourself.

In this case, it is best to purchase “underinsured motorist” coverage from your own company. Underinsured motorist coverage is similar to uninsured motorist coverage; it provides payment to you if you are hit by a motorist carrying only the minimum liability requirements and your damages exceed this amount.

Uninsured and underinsured motorist coverage is often sold together as a single policy, covering both scenarios.

You can find out what your current liability limits are by looking at the declarations page of your policy or by contacting your agent.

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