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SR-22 Insurance and Your Financial Responsibility

accident-151668_640Though many people assume that obtaining a driver’s license becomes their right once they’ve hit the legal age, it is actually a privilege that can only be kept by obeying the laws set forth by each state. One of the most important stipulations to keep in mind involves the need to maintain proof of financial responsibility. This phrase can have many different meanings, but when it comes to the rules of operating a vehicle, it refers to a driver’s ability to be financially responsible if there ever comes a time that bodily and property damages are caused as a result of their driving. Depending on the seriousness and circumstance of the incident, there can be severe penalties that lead to a suspended license and the need to acquire SR-22 insurance.

Types of Financial Responsibility

Just as laws vary from state to state on other topics, so do they in regards to driving and insurance regulations. The majority require those with a driver’s license to be able to show proof that they can cover a minimum amount of liability should they be found at fault in an accident. Financial responsibility is usually purchased in the form of an auto insurance policy, but some states also accept a cash deposit with the DMV, a self-insurance certificate or a surety bond.

If a motorist gets caught uninsured or has their license suspended for any reason, they may be ordered to submit either an FR-44 or SR-22 insurance form depending on the state. These documents serve as proof of financial responsibility when a driver is trying to reinstate their driving privileges.

When Proof of Financial Responsibility is Required

Most states require that proof of financial responsibility be carried at all times when a vehicle is being driven. Motorists will have to be able to produce evidence of the type of financial responsibility they have and that it is up-to-date whenever asked by a law enforcement official after being pulled over for a traffic violation, when renewing a vehicle registration or when involved in a traffic accident.

When SR-22 Insurance May Be Required

As mentioned above, SR-22 insurance is actually a form and not an insurance policy. It is filed by an insurance provider and kept as an addendum once a policy has been purchased that meets the minimum requirements of the state. The most common reasons for an SR-22 request include DUI, numerous traffic offenses in a short period of time and driving uninsured.

Owner vs. Non-Owner SR-22 Insurance

There are generally two different forms that can be filled out for SR-22 insurance. The one needed will depend on the driver’s car-owner status. An owner certificate covers a motorist who owns and is insuring their own vehicle, while a non-owner certificate covers a motorist who is driving a car owned by someone else and does not have a vehicle registered in their name.

Financial responsibility is meant to protect all parties that may be part of a traffic collision. Without the appropriate amount of coverage, you could find yourself having to pay excessive expenses out of pocket. If you find yourself needing SR-22 insurance, it’s always best to shop around and get several quotes before deciding who to sign up with.

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