Overview of South Carolina’s Auto Insurance Laws 1) INSURERS no longer have to insure all vehicle owners regard- less of risk. An insurer may refuse to write auto insurance, but cannot base the refusal on income level, race, creed, national origin, ancestry, marital status, or lawful occupation, including military service. 2) ANY eligible consumer may legally drive uninsured in South Carolina by paying an annual fee of $550 to the Department of Public Safety. However, if that consumer is involved in an acci- dent, he/she will be personally liable for damages caused to the property or person(s) of the other vehicle and any passengers in his or her own car. 3) CONSUMERS have to provide proof of insurance or authori- zation to legally drive uninsured upon the request of law en- forcement officers. 4) THE South Carolina Associated Automobile Insurers Plan (SCAAIP) provides insurance to eligible South Carolina con- During the past few years, significant changes sumers who are unable to obtain coverage from a private insur- have been made to automobile insurance in South ance company. Carolina in an effort to lower the costs of insur- ance for South Carolina consumers. Every driver 5) THE recoupment fee for zero-pointed drivers has been elimi- needs to be aware of how the automobile insur- nated. However, drivers with moving violation convictions re- ance laws impact them personally from private ceived between March 1, 1996 and March 1, 1999 will continue insurance companies. to pay a recoupment fee until the debt is recovered. The recoup- ment fee is capped at 10% of the vehicle owner’s liability insur- The following is a list of some of the more signifi- ance and the uninsured and underinsured motorist coverage pre- cant changes to the marketing and sale of automo- miums. bile insurance in the State of South Carolina. Prepared by the South Carolina Department of Insurance Why Should I Buy Auto Insurance? Drive Suite 1200 eligible consumers to legally 300 Arbor Lake South Carolina law allows drive uninsured. However, if you drive legally uninsured P.O. Box 100105 an accident, you may be responsible for the and cause losses of the other person(s) involved. A claim may be filed against you for those losses. You may have to pay not only for Columbia, South Carolina 29202-3105 the property damage you cause, but also for the medical expenses, wages, and pain and suffering of any injured person(s). (803) 737-6180 // (800)-768-3467 Auto liability insurance coverage is designed to protect you from personal liability for these types of losses. Liability www.state.sc.us/doi insurance also pays for a lawyer to defend you against any claim or lawsuit filed against you. PAGE 2 S O UT H CAR O LINA AUT O MOBILE INSURANCE FACTS AND T IPS The First Step: How to Shop Around Since the removal of the mandate to insurance. Before buying automobile Once you have narrowed your search to the write automobile insurance in South insurance, you should contact a number of companies with the best range of prices, you Carolina, many insurance companies agents to find the best combination of should consider each company’s reputation have entered our market. This means service and price for your insurance for financial stability, policyholder service, increased competition and more compa- needs. underwriting practices, and claims handling nies to choose from when buying auto practices. Service is difficult to measure, so insurance. The most important thing for The first step is knowing how much insur- ask friends and neighbors what they think a consumer to do is to shop around for ance you need. If you know what you about the service they are insurance. need, you are less likely to purchase un- being provided by their necessary coverages. Once you determine insurance companies if The rates charged for auto insurance are your needs, call several agents. Ask them you are considering the competitive. This means that different to give you a quote on how much the pre- same companies. insurance companies are charging dif- mium will be for the auto insurance cov- ferent prices for auto insurance. Choos- erage you are seeking. Be sure you pro- ing your auto insurance company is vide the information suggested in the much like choosing any other product. Points To Remember section of this Price is important, but it is only one factor to be considered when purchas- newsletter. ing auto insurance. Before buying auto Know Your Rights 1 Points to Remember When Shopping For It is important that you know what your rights are. Auto Insurance South Carolina law prohibits an insur- When shopping around for automobile Different insurance companies charge ance company from refusing to issue an insurance coverages, it is important that different rates for the same coverages. automobile policy solely for the dis- all shoppers be prepared to provide at When comparing different companies, criminatory reasons outlined on Page 1. least the following information to each you may want to remember the fol- If you are refused auto insurance for one insurance agent or company to receive lowing points: of the reasons listed on Page 1 and for no an accurate and complete quotation: other reason, the actions taken by the 1) Compare premiums for each cover- insurance company may violate South 1) Complete description of vehicle; age, then compare the total cost for Carolina law. each policy. 2) Description of how the vehicle is 2) Ask about discounts and what is Also, if your policy has been in effect for used; required to qualify for them (i.e., 90 days or more, the insurance company 3) Your driver’s license number and homeowners, renter’s insurance, cannot cancel your policy for the re- the driver’s license numbers of all life, health, multi-car, good student mainder of the policy term unless you licensed drivers in the household; and safe driver). fail to pay the premium on time or you 3) Consider if you only need liability or any operator in your household who 4) Driving record information for customarily operates your automobile coverage (i.e., if your vehicle is 10 yourself and all customary opera- years+ and you can afford to repair has had their license suspended or re- tors; or replace your vehicle, you may voked. 5) Accident claims information for want to drop collision and compre- In addition, the insurance company in- each driver; hensive coverage). It may save you tending to cancel or non-renew your money. policy must give you notice, in writing, 6) Type of coverages and limits 4) Ask about other discounts that are of the reason(s) for the cancellation or needed; available (e.g., air-bag, automatic non-renewal of your coverage(s). The 7) Collision and comprehensive de- restraint systems, anti-theft devices). notice must tell you that you have the ductible amount; 5) Start shopping around at least 45 right to appeal the decision to the South days before your policy is up for Carolina Department of Insurance (DOI) 8) Proof of ownership of vehicle; renewal. and must inform you of the availability 6) If your policy is cancelled or not of other insurance through another in- 9) Proof of continuous or prior insur- surer or through the S.C. Associated ance. renewed, begin shopping around as soon as you receive the notice from Automobile Insurers Plan. the insurance company. 7) Your credit history can be a factor in determining rates. S O UT H CAR O LINA AUT O MOBILE INSURANCE FACTS AND T IPS PAGE 3 What To Do If Your Policy Is Know Your Rights 2 Cancelled Or Non-Renewed In addition to the reasons stated on the 6) One claim by an insured under the previous page, an insurance company medical payments coverage or Within 15 days of your receipt of the no- cannot non-renew your automobile in- medical expense coverage due to tice of cancellation or non-renewal, you surance policy solely on the basis of any an accident for which the insured or your attorney may request in writing to one of the following factors: was neither wholly nor partially at the SCDOI that the action of the insurer fault; be reviewed. The Department is required 1) Lawful occupation, including mili- to determine whether the insurer’s cancel- tary service; 7) One or more claims submitted lation or non-renewal complies with SC under the comprehensive or tow- law. 2) Lack of driving experience or the ing coverages under cer- number of years of driving experi- If the SCDOI finds that the can- tain specific conditions; ence; cellation or non-renewal was not 8) Two or fewer motor ve- in accordance with SC law, it 3) Lack of supporting business or lack hicle accidents within a must notify the company and of the potential for acquiring such 36 month period unless you that the cancellation is not business; the accident was caused effective. However, the SCDOI 4) One or more accidents or violations either wholly or partially cannot substitute its judgment that occurred more than 36 months by the named insured, a for that of the company as to the immediately preceding the upcom- resident of the same underwriting of the policy. ing anniversary date; household, or customary operator. South Carolina law also requires that the 5) One or more claims submitted under insurance company inform you, in writ- the uninsured motorists’ coverage of Insurers may refuse to renew policies ing, if the rate level you are being charged the policy where the uninsured mo- for false or fraudulent claims. An in- is higher than the lowest rate level for that torist is known or there is evidence surance company may also modify insurance company. of physical contact; comprehensive and towing coverages at the time of renewal under certain circumstances. What To Do If You Are Turned Down For Insurance Contact Your Agent Or insurance company, keep a written If all else fails and you are unable to ob- Insurance Company record of the date and time of your call, tain auto insurance from any insurance the name of the person you talked to, company, any agent certified by the If you believe that your company has and what was said during the call. You SCAAIP can obtain insurance for you improperly refused to issue or renew are entitled to an explanation of the rea- through the SCAAIP. This is the market your policy, contact your agent or insur- sons for refusal or non-renewal of your of last resort and, for this reason, the pre- ance company immediately. You have policy. Keep a list of the reasons why miums charged are higher than those the right to question that decision and you are being turned down for cover- charged by private insurance companies. file a complaint if necessary. A letter of age. You will also have to meet certain eligi- complaint to the agent or insurance com- bility criteria to obtain coverage. Use the pany works best. Keep a copy of your If you have been turned down by one SCAAIP only as the last resort for insur- letter for your files. insurance company, try another. Do not ance. assume that you will be turned down by If you decide to register your complaint all companies. The best rates will be by telephone to your agent or to your available in the voluntary market. Assistance From The South Carolina Department of Insurance If you do not receive a prompt, courte- The Department WILL: 1201 Main Street, Suite 1000 ous, and satisfactory response to your • Thoroughly investigate your complaint. Columbia, SC 29201 inquiry from your insurance company, • Answer any questions about what the P. O. Box 100105 you may need the assistance of the insurer is required to do under SC law. Columbia, SC 29202 SCDOI. The Office of Consumer Ser- • See that you receive a response to your vices can provide general information on inquiry. 803-737-6180 the laws regarding cancellations, non- 800-768-3467 renewals and refusals to write. It can The Department CANNOT: (Toll Free Only in SC) also provide claims and coverage infor- • Provide legal advice. 803-737-6231 - fax mation to consumers. • Force a favorable action if your complaint is not supported by facts and law. www.doi.sc.gov S O UT H CAR O LINA AUT O MOBILE INSURANCE FACTS AND T IPS PAGE 4 How To Reduce Your Violations and Accidents May Affect Premiums Your Premiums • Shop around - Shop around. Violations and accidents may cause your premiums to be higher. Insurance is based • Remain or become a good risk driver. in part upon risk. Risk involves the possibility of financial loss. The greater the risk you are, the higher your insurance premiums will most likely be. • Obey all traffic laws and avoid traffic citations. Do not drive in excess of the For automobile insurance, the type of risk you are is determined in part by your driv- posted speed limit. Accidents could ing record. If you or a family member of your household has caused a traffic acci- increase your premiums. dent, been convicted or pled no contest to traffic violations, such as speeding or • Check with your agent or insurer and reckless driving, the price you must pay to obtain auto insurance will be higher than get a list of available discount and pre- that charged to a person who does not have similar convictions. How much more a mium credit programs. driver has to pay for auto insurance depends upon that individual’s driving record and the insurance plan without any traffic violations as offered by the insurance • Consider increasing your collision and company. comprehensive deductibles. • Before purchasing your next vehicle, ask which vehicles are rated for higher insurance costs. Answers to Some Frequently Asked Questions Question: Can a family member’s Question: South Carolina law now Question: If I have to purchase insur- poor driving record affect my insur- allows me to legally drive unin- ance through the SCAAIP because of ance premiums or insurability even if sured if I pay an annual fee of my driving record, how long must I I have a clean driving record? $550. Where do I pay the fee and remain in that plan? what is the money used for? Answer: Yes, if that family member is Answer: You only have to remain in the a resident of your household or custom- Answer: The fee is paid to the South SCAAIP until you are able to purchase arily operates a vehicle that you own. Carolina Department of Public insurance through the regular (voluntary) Safety. It is used to offset the costs of market. Before each renewal, you should Question: What is the minimum auto uninsured motorist coverage and to shop around for insurance coverage to insurance coverage I must carry? provide education programs for see if another insurer will accept you. If South Carolina consumers. you have had no new accidents or viola- Answer: You must maintain liability tions, you may be able to find a volun- coverage and uninsured motorist cover- Questions about the uninsured motor- tary company that will write your auto- age as follows: $25,000 bodily injury ist fee should be directed to the De- mobile insurance coverage. for one person, $50,000 for two or more partment of Public Safety, Division persons, and $25,000 property damage. of Motor Vehicles, P.O. Box 1498, For additional information, please con- These are the minimum limits as of Columbia, South Carolina 29216. tact the South Carolina Department of January 1, 2007. Call 1-803-896-5000. Insurance Office of Consumer Services at 1-803-737-6180 or 1-800-768-3467. This publication has been created and distributed by the South Carolina Department of Insurance to provide consumers with information about existing state automobile laws.