Consumer - Auto - Auto Facts and Tipspub

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					         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
 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
                                                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
                                                     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

                       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
                                                  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.               
                              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.

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