Massachusetts Car Insurance Requirements
Drivers in Massachusetts must prove financial responsibility in order to register and drive a vehicle in that state. And there’s only one way to do it: buy a car insurance policy that offers a minimum amount of liability, personal injury protection, and uninsured/underinsured motorist coverage.
All policies must be produced by an insurance company licensed to sell insurance in Massachusetts. Furthermore, the insurance must remain in place for as long as the vehicle owner maintains in active registration on his car.
As a no-fault state, Massachusetts expects each driver to pay his medical expenses, regardless of who is at fault. One driver cannot sue another driver for personal injury claims unless his injuries meet a monetary threshold established by state law.
All car insurance policies in Massachusetts must provide coverage in the following amounts:
- bodily injury/death liability – $20,000 per accident for one person
- bodily injury/death liability – $40,000 per accident for multiple persons
- personal injury protection – $8,000 per accident
- uninsured/underinsured motorist – $20,000 per accident single; $40,000 per accident multiple
- property damage liability – $5,000 per accident
The Managed Rating Option
Massachusetts has an unusual system by which premiums are rated. In most states, the law assigns a certain value to various types of traffic violations, usually in the form of points on the license. Insurance companies use these arbitrary ratings to grade your driving history and set your premiums.
In Massachusetts insurance companies are allowed to apply the state rating system or develop one of their own. The ability to create a customized rating plan increases competition among Massachusetts insurance companies and helps to keep prices lower.
Securing Proof of Insurance
Your insurance company will provide you some sort of proof of insurance that includes your name, policy number, make and model of your vehicle, and appropriate liability limit information. In addition, the company is also required to fill out and submit an RMV-1 form on your behalf. This form signifies to the state that you have purchased a minimum liability policy.
One of the downsides to the managed risk scenario, from the perspective of the driver, is that allowing your car insurance to lapse will almost always result in higher premiums for future car insurance policies. You may also see a rate increase if you’re ticketed for not being able to provide proof of insurance at the request of police officer.
Obviously, if you’re caught driving without insurance you will be fined and an insurance company will have the right to charge you higher rates in the future.