New York is a great state to live in and has some of the best insurance requirements in the United States. It is a no-fault state and the minimum requirements are set at pretty good limits. The car insurance company you buy a policy from must be licensed by the New York State Insurance Department or your policy isn't valid. The New York auto insurance company will automatically electronically notify the state of New York when your policy goes into effect and when it ceases. Someone who allows their insurance to lapse can incur strict fines and penalties. Understanding no-fault insurance is difficult. I will try to explain it as best as I can.

No-fault insurance is when your insurance covers your injuries and damages and the other drivers insurance covers theirs regardless of who is to blame. No-fault states typically have cheap car insurance costs, but some places actually have higher rates due to some unresolved issues. They require that all drivers hold liability insurance, personal injury protection (PIP) and uninsured motorists bodily injury coverage.

The PIP part of the insurance is the no-fault part. Your PIP covers your injuries. Motorists are still required to carry liability coverage in case the accident was your fault and the other driver's insurance doesn't fully cover his or her injury costs. Then hopefully your liability insurance will cover the remainder of his or her medical bills. If it doesn't, you could be sued for the balance. Uninsured motorists insurance is just that. It covers costs associated with a crash involving an uninsured driver. Even though insurance proof is required to register a vehicle, there are still uninsured people who will drive unregistered vehicles.

New York's fines and penalties are vicious. When you insurance policy is no longer valid, you must turn in your registration plates. If your insurance lapses, the insurance company immediately informs the state of New York's auto insurance department. The state can then void your registration and/or suspend your license. When switching insurance companies it is always best in New York to buy the new policy BEFORE canceling the old one. This will alleviate any possibility of the state receiving the cancellation before the proof of new insurance. Fines run between $8.00 and $12.00 per day your registration is suspended for up to 90 days. If you drive uninsured, your car could be impounded and you can be fined and ticketed.

Understanding New York auto insurance laws may be confusing, but not impossible. While searching for cheap car insurance, be sure to ask for clarification on all issues that are still fuzzy to you. Once you are all set on a policy, you can drive with the knowledge that you are adequately covered.