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New Auto Insurance Limits in Arizona May Affect Your Coverage

Posted on July 7, 2020 in

Like all other states, Arizona requires that licensed drivers must have automobile insurance to cover any unexpected accidents or other liability-based incidents. However, Arizona has recently passed a new law that has changed the minimum acceptable coverage amounts. These new limits may bring questions regarding your current coverage, and any future coverage you may be considering.

What Are the New Limits?

Previously, the minimum amount of liability coverage that drivers must have in order to operate a vehicle in Arizona followed the “15/30/10” formula:

  • $15,000 covering any bodily injuries or death of one person.
  • $30,000 covering any bodily injuries or deaths of two or more persons.
  • $10,000 covering any property damage.

Effective July 1, 2020, the new Arizona law has effectively increased these liability coverage limits to 25/50/15:

  • $25,000 coverage for bodily injury or death of one person.
  • $50,000 coverage for bodily injuries or deaths of two or more persons.
  • $15,000 coverage for any resulting property damage.

Under the new law, all insurance providers are now required to offer a 25/50/10 policy as their minimum acceptable policy.

What If My Current Coverage is Below the New Limits?

If you are a current licensed driver that has renewed your policy on or after July 1, 2020 under the previous minimum limits, your policy will automatically be adjusted to reflect the new limits. If you are seeking a new insurance policy, you will notice that all insurance providers now offer the new minimum limit as the base policy for drivers.

So, for example, if your policy is up for renewal in August, and you are still under the previously established minimum coverage, your policy will automatically be adjusted to the new minimum limit upon renewal. Additionally, if you have just renewed your policy in May or June, you may be permitted to retain the old 15/30/10 coverage until your next renewal.

What About Underinsured/Uninsured Motorist Coverage?

Under this new law, underinsured and uninsured motorist coverage minimums will also increase – from 15/30 to 25/50. Any policies with the new coverage in place will adjust accordingly to the new limits.

Will My Premiums Change?

Unfortunately, as the amount of coverage increases, so too will the insurance premiums you are required to pay. Your premiums will likely increase the next time you renew your policy, but it is worth contacting our insurance provider to get a more accurate picture of any changes in premiums for the next year.

Why Are These Changes Happening?

These adjustments to insurance coverage requirements in Arizona may seem somewhat arbitrary – and the increase in premiums can be enough to sour some on these increases. However, states frequently adjust limits in automobile coverage in order to provide more financial protection for drivers. This is especially important as populations grow and the number of drivers on the road increases accordingly.

It is important to note that Arizona has one of the lowest insurance coverage requirements in the nation – largely in part because they have not revised or adjusted the previous limits in decades. This new law provides the first increase in insurance premiums in over 40 years.

This increase in minimum coverage ensures that if you are involved in a serious car accident, any damages incurred due to liability will be adequately covered by your (or the at-fault party’s) auto insurance policy. This peace of mind is well worth the increase in premiums and coverage.

If you have any questions or concerns, please contact your insurance policy provider for more details. If you or someone you know have been injured in a car crash, contact our Prescott car accident lawyers for a free consultation to discuss your case.