Indiana Auto Insurance Laws
Auto Insurance Laws and Trends in IN
Like most states in the country, Indiana follows the tort system of insurance. Whoever is found to be responsible for an accident must pay all medical expenses and property damages. Indiana makes it mandatory for all drivers to prove that they have financial responsibility to pay for injuries in case they are involved in an accident. Different ways that a motorist can prove financial responsibility include:
- Purchase a liability insurance policy
- Deposit $40,000 with the state treasurer
- Show that you have a trust fund in the minimum amount of $40,000
- A surety bond in the amount of $40,000
Most drivers opt to purchase a liability insurance policy, as it is the most economical and less complex method. If a driver allows an insurance policy to lapse or if it is cancelled (by the policy holder or the insurance company), in order to have the policy re-instated, there will be a surcharge of 25% to 50% added onto the premium. This is in effect to deter motorists from cancelling a policy shortly after purchasing it.
Factors in Indiana auto insurance premiums
There are many factors that determine the final premium that an individual will pay for his or her insurance. Some of these factors are:
- Age, sex, and marital status
- Claims history, tickets, convictions, suspensions
- Make and model of vehicle, distance driven annually
- Use of vehicle: business, commercial, commuting, or pleasure
- Territory of residence
- Type of coverage chosen and the deductible amount
Indiana enjoys insurance rates that are below the national average. These premiums are relatively stable, fluctuating only minimally each month. In the last year, the following premium trends were observed:
Month |
Indiana Average (in $) |
National Average (in $) |
January |
127 |
153 |
February |
125 |
152 |
March |
127 |
152 |
April |
128 |
151 |
May |
127 |
149 |
June |
125 |
150 |
July |
128 |
151 |