Tuesday, 13 May 2008
New Alabama Law Will Raise Auto Insurance Liability Limits
The Alabama Senate and House of Representatives approved a bill earlier this year which will raise the minimum liability limits for auto insurance, which haven’t been increased in over 24 years. Now, the bill is going to Governor Bob Riley’s desk for his signature.
Under the measure, drivers must purchase auto insurance that covers at least $25,000 for single injury or death, $50,000 for multiple injuries or deaths, and $25,000 for property damage, reported Insurance Journal.
The new amounts increased liability limits $5,000, $10,000, and $15,000, respectively. The bill also ups the minimum level of uninsured motorist coverage, which is optional according to Alabama state law.
Few drivers will be actually affected by these changes because most already have liability coverage higher than the minimum.
For those who will need to get more coverage, rates will go up $20 to $30 a year. Rates for uninsured motorist coverage are expected to increase around $13.
The measure passed easily in both the state House and Senate, and Governor Riley has said he will sign it into law.
Once signed, drivers and insurance companies will have three months before the new limits go into effect. Governor Riley had previously vetoed a similar bill that would implement the limits immediately, arguing consumers and insurers needed time to adjust.
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