An Informative Guide to Car Insurance in North Carolina

Author: Auger Law | January 29th, 2019

Family riding in car

Under North Carolina law, all vehicles (except for utility vehicles that aren’t used on public roads) must be protected by insurance policies. In fact, you can’t get your license plate for your car until you have proper insurance — and many car dealerships won’t sell you a car until you prove you have insurance.

If you drive without insurance, you are not only breaking the law, but you’re also setting yourself up to financially responsible for any injuries that you may cause as well as for any damages to vehicles or other property involved in your accident. Our Charlotte car accident lawyers have seen this issue come up frequently in cases involving uninsured motor vehicles.

Without car insurance, you are taking a huge risk. If you are going to be out on the road behind the wheel of a car, be a responsible person – be a safe and responsible insured driver! Here’s everything you need to know about insurance in North Carolina, including how a lawyer can help if your insurance company doesn’t send you a fair settlement.

Who Needs Insurance in North Carolina?

Under North Carolina law, every vehicle that operates on a public road must have insurance. This includes personal passenger vehicles, commercial vehicles, motorcycles and, unlike some other states, mopeds. However, there are some vehicles that don’t have to be insured.

Utility vehicles like dirt bikes, ATVs, UTVs and golf carts don’t have to be insured — as long as they are never used for transportation on public roads. This is because they aren’t generally designed to be used in road traffic. However there are exceptions.  For example if you use a dirt bike on public roads, it must be registered as a motorcycle, which requires liability insurance.

How Much Insurance Do I Need?

The state’s minimum insurance requirements include:

  • Bodily injury liability coverage of at least $30,000 per person in the accident for bodily injury
  • Bodily injury liability coverage of at least $60,000 per accident
  • At least $25,000 in property damage liability
  • At least $25,000 in uninsured/underinsured driver property damage coverage
  • At least $30,000/$60,0000 in uninsured/underinsured driver bodily injury coverage

What isn’t included in the minimum requirements is collision and comprehensive coverage, rental car coverage or roadside insurance for towing your car or truck after an accident. However, if you can afford these coverages, they can be incredibly beneficial in the event of a car wreck.

You may have some questions about the uninsured/underinsured driver coverage that is listed above. While this coverage can help if you’re in a collision with a driver with less-than-adequate insurance, it’s vital for hit-and-run accidents. In these cases, your uninsured/underinsured driver coverage should kick in to cover the injuries or property damage you sustain if you should ever be hit by a vehicle that leaves the accident scene.

What Happens If I Don’t Have Insurance?

Car insurance is required by North Carolina law; that’s why officers always ask to see proof of insurance if you get pulled over. If you are caught without insurance, the first offense can carry a penalty of $50. The second offense is $100, and the third and subsequent offense is $150. These fines must be paid (and you must show proof of insurance) within 10 days, or your license will be suspended.

But these penalties are small potatoes compared to being in a car wreck without insurance. If you don’t have insurance covering you, you may be on the hook for all the damage to your own car and any injuries to yourself, passengers or other people that you may have hurt. In NC, all of the other people in the wreck you caused (including your passengers) can file personal injury claims against you, which could result in you being sued or having to go to court.

A commonly asked question is whether you can buy insurance that would provide retroactive coverage for an accident that has already happened. After an accident is always a good time to review your coverage with your insurance co, but a policy purchased after an accident won’t cover the accident that you were just in. In addition, that wreck and lapse in insurance coverage may mean any future policies you purchase will cost you more than other drivers that do not have lapsed coverage or at-fault accidents on their driving record.

In short, make sure you have car insurance if you are going to be on the road!

How Are Insurance Premiums Calculated?

Insurance premiums are your payments for coverage. They’re usually paid monthly or every 6 months. Premiums are generally based on the odds of how likely it is that you will file a claim.

That sometimes is calculated based on a variety of factors that may include:

  • Your credit rating
  • Your driving history
  • Your location
  • Your age
  • The value, make and model of your car
  • Your gender
  • What type of coverage you buy, and how much you buy
  • Any previous lapses in insurance coverage
  • Other risk factors (criminal history / previous DUIs)

Each insurance company has their own proprietary formula to decide how much of a risk you are to insure. The higher the risk, the more your premium will increase. So, for instance, a 23-year-old man who drives an expensive sports car may pay a higher premium than a 40-year-old woman who drives a minivan.

Perhaps the biggest factors in the above example are age and gender. It’s been proven time and time again that young male drivers are more aggressive than young female drivers. Mix in the fact that younger drivers have less experience on the road, and the fact that young male drivers generally have higher premiums makes more sense.

Other Factors You Need to Know About Car Insurance in North Carolina

Like every state, there are specific details in North Carolina’s car insurance laws that you should be familiar with if you’re driving in this state. For example:

  • If anyone that you live with will be driving your vehicle, have them listed as additional drivers on your policy.
  • Insurance companies must provide a reason why they deny your claim and/or cancel your policy.

A Comment on Insurance and Providing Rideshare Services

Your “regular” auto insurance policy may not cover any accidents that happen while you’re driving for Lyft or Uber. If you work with Lyft, Uber or some other application that involves your vehicle, speak to your insurance co and the ride share company / app about the type(s) of insurance you need to be fully covered in the event of an accident.  Please note that these coverage issues can have a negative effect on you even if you are not the at-fault driver.  There are significant disclaimers on most auto policies regarding using your vehicle to provide rideshares or deliveries.  In some instances, our firm has been contacted about coverage disputes where the driver was denied coverage because they did not have the proper type of insurance, and this was in a situation where the Uber driver did not even cause the accident!

If you use your vehicle for work, talk to your insurance company and your employer about your insurance coverage!

Insurance for Commercial Vehicles

Commercial vehicles can generally be thought of like work trucks, work vans, tractor trailers, some delivery vehicles and others as well. If you are involved with a large commercial vehicle in a motor vehicle accident or other vehicle that you may think would be considered a commercial vehicle, you should speak to an experienced motor vehicle accident injury attorney because these types of cases are very different than accidents involving non-commercial vehicles.  In some accidents an experienced accident lawyer may even want to conduct their own investigation that may involve expert analysis of important evidence such as the commercial vehicle’s “black box” and driver’s log.

For the most part, people driving commercial vehicles have different licensing and insurance requirements for their vehicles. If you have questions about licensing or insurance requirements for commercial vehicles you should reach out to a commercial vehicle insurance broker and the state DMV.

When Should You Contact Your Insurer After an Accident?

After an accident, your first call should be to 9-1-1 to get a police officer and ambulance to the scene. After you’ve received medical attention and you have spoken to the police, you should consider speaking to an experienced injury law firm before talking to anyone from any insurance company.

All too often people make the mistake of speaking to the insurance company before they realize they should have spoken to a lawyer first. The insurance company may want you to give a statement about the facts of your injury accident and information about your injuries.  Such statements can effect whether or not an insurance company pays your claim and how much they pay.  If an insurance company gets ahold of you before you have spoken to an accident attorney, tell them politely but firmly that they can get further information from the police report and that you’d like to speak with your attorney before answering any questions.

Let Our Car Accident Injury Lawyers Help You

At Auger & Auger, we always offer free initial consultations. That means we’ll review the details of your case and let you know how we may be able to help you. Call us today at (704) 364-3361 or contact us online for a free, no-obligation consultation. We know how insurance companies work and we have the experience to help you fight for the compensation that you may be entitled to. Give us a call to see how we can fight for you!

Posted In: Car Insurance Tips