Wisconsin Auto Insurance Laws
Auto Insurance Laws and Trends in Wisconsin
Like most of the other states in the country, Wisconsin uses the tort system of insurance to determine claims. The person who is deemed to be responsible for an accident must pay for all medical expenses and property damage that has occurred as a result.
Purchasing an auto insurance policy is the most common and economical way to prove financial responsibility (showing the ability to pay for expenses incurred in an automobile accident). Drivers can also choose to make a $60,000 cash deposit or bond with the DMV.
Optional auto insurance coverage in Wisconsin
Drivers in the state of W isconsin can also purchase optional insurance coverage . Physical coverage such as collision and comprehensive will pay for damages caused by collisions, upsets, fire, theft, vandalism, windstorm, hail, or animal collision. Under/uninsured motorist coverage will pay for expenses incurred if involved in an accident with a driver who has no insurance or carries inadequate insurance. Personal injury protection will pay for medical expenses, funeral expenses, loss of wages, and rehabilitation costs.
What to expect of auto insurance costs in Wisconsin
Wisconsin enjoys the 4th lowest insurance rates in the country, with the average premium being $590 per year. Insurance premiums are calculated using a number of different factors. These facts are determined by the National Association of Insurance Commissioners who only take into account liability insurance. They do not factor in if drivers have purchased collision and comprehensive coverage . They also take into consideration the population of the area, the amount of traffic congestion, and the average income of the residents.
Where exactly does the money collected from these premiums go? Actually, it is distributed into several different areas:
- Profit: 5%
- Claims (medical expenses, car repairs, property damages, lawyer fees): 68%
- Expenses (operating costs for insurance companies): 25%
- Tax: 2%