New Mexico Auto Insurance Basics

New Mexico automobile insurance is quite frankly protection. It's a contract entered into between an insurance company and an individual. This contract states that the insurance company agrees to protect an individual from any financial loses as a result of a motor vehicle accident in exchange for a specific dollar amount of insurance premiums. Each insurance policy will clearly state what types of losses are covered, the coverage limits, and any other conditions. New Mexico auto insurance generally also provides coverage for medical expenses, liability, and property cost as well. Medical expense coverage will pay for any treatment or rehabilitation required as a result of bodily injury resulting from a motor vehicle accident. Liability coverage will pay if the insured individual is at fault in any accident that results in bodily or personal injury to another party. Property coverage pays for the cost of the damage to the vehicle and other property. The property component will also cover the cost to replace the car in the event it is stolen.

Due to the strict New Mexico automobile insurance laws, it's important that all drivers carry proof of their insurance coverage inside their vehicle at all times. Individuals who are unable to provide this information may receive an expensive fine or lose their vehicle's registration.

Types of Auto Insurance offered in New Mexico

There are six different types of auto insurance coverage options available to residents. Whenever an state resident operates a motor vehicle they are required to obtain New Mexico car insurance. Additionally, cars that are currently being financed are required to have insurance coverage even if they are not in use. These polices can typically be purchased for a period of six months or a year. Though each of these coverage options are not required by the state, they are available.

Property Damage Liability - This coverage option will pay for the damage caused to another vehicle by the insured's vehicle. When this insurance is used it's because the other party's vehicle was damaged. However, this coverage will also pay for damages to other private and public property including telephone poles, homes, other buildings, fences, or any other structures that may have been hit by the car.

Comprehensive - This coverage allows the insured to be reimbursed if their car is damaged by an event other than an accident or is stolen. These incidents could include natural disasters, vandalism, fire, or hail. This coverage will also pay for occurrences such as crack windshields as well.

Collision – This component pays if the insured's vehicle is damaged as a result of colliding with another object or car, if the car flips over, or is damaged by a pothole. If the insured is at-fault in a motor vehicle accident, the insurance company will cover the cost to repair the vehicle as well, less the deductible. Generally, collision insurance carries a $250 to $1,000 deductible. As with all insurance coverage, the higher the deductible, the lower the cost of the premium.

Medial Payments or Personal Injury Protection (PIP) – This coverage serves as protection for the insured and any other passengers involved in the motor vehicle accident.

Uninsured and Under-insured Motorist Coverage – This agreement ensures that the insured is covered if they are in a motor vehicle accident with an uninsured driver or a driver who doesn't have enough insurance to cover the cost of the damages incurred. This coverage also protects vehicles and pedestrians involved in hit and run incidents.

New Mexico Auto Insurance Laws

Like most other states, New Mexico has set into law a set of minimum standards for the amount of coverage an individual must carry in order to legally operate a motor vehicle. Even though the state has set specific amounts in place, many insurance companies recommend that individuals go beyond these coverage amounts to ensure their vehicle is completely covered. In most instances, the cost of damages in a motor vehicle greatly exceed the state minimums. Keep in mind, in the event of an accident, the at-fault party is responsible for all expenses incurred as a result of the motor vehicle accident, including medical bills and property damage.

New Mexico Coverage Scale:

* $25,000/$50,000 - bodily injury liability

* $10,000 – property damage liability

Uninsured motorist bodily injury, medical payments, collision, and comprehensive coverage are all optional coverage components.

To receive New Mexico auto insurance quotes, here is a brief listing of insurance companies licensed in the state:

* Geico Insurance Company

* Progressive Insurance Company

* Allstate Insurance Company

* Liberty Mutual Insurance Company

* Travelers Insurance Company

New Mexico Automobile Insurance Rates

According to car insurance ratings, New Mexico ranks twelfth highest on the list of U.S. automobile insurance average premium costs, with not so cheap auto insurance. New Mexico residents pay an average annual cost of $1,603.65 each year, which is higher than the average U.S. driver pays in automobile insurance each year. When purchasing automobile insurance, it's essential to obtain New Mexico car insurance quotes from several different companies. It's just as important to have a premium amount that is affordable as it is to have a policy that covers the cost of a motor vehicle accident.

Factors that determine local rates:

* Seat belt use – New Mexico residents have a record of 84% seat belt use, this is only a percentage lower than the national average of 85%.

* Vehicle theft – As a whole the state has between 113.81 and 435.36 auto thefts per 100,000 residents. In fact, the city of Albuquerque is ranked as one of the nation's top ten cities for auto theft. The most frequently stolen car in the state is the 2001 Dodge Ram.

* Roads and road conditions – New Mexico drivers benefit from the roads and road conditions in the state. Due mainly to its fairly mild climate, New Mexico auto insurance ratings reflect the state's low occurrence of weather-related motor vehicle accidents.

These factors as well as additional factors combined make it slightly more difficult to find New Mexico cheap car insurance rates. For more information on insurance rules and regulations for the state of New Mexico, contact the state Department of Insurance (http://www.nmprc.state.nm.us/id.htm).