Car insurance in Texas

What Texas law requires

Texas is a financial responsibility state: you must be able to pay for crashes you cause, and almost everyone does that by buying auto liability insurance.

Minimum liability limits (often written as 30/60/25):

Liability pays other people — their injuries, their vehicle, their damaged property. It pays nothing toward your own car or your own medical bills.

Two coverages are automatically added to every Texas auto policy unless you turn them down in writing:

• Personal injury protection (PIP), which comes with a modest state-set minimum amount and covers medical bills plus things liability-only policies skip, such as lost wages.
• Uninsured/underinsured motorist (UM/UIM) coverage — insurers must offer it, and it only comes off your policy if you reject it on paper.

So while PIP and UM/UIM are not legally required, you have them by default. If a quote looks unusually lean, check whether a rejection form was signed on your behalf.

Nothing in state law forces you to buy collision or comprehensive coverage — but if you have a car loan or lease, your lender will. The Texas Department of Insurance (TDI) notes that if those coverages lapse, the lender can buy single-interest coverage, add it to your payment, and that coverage protects only the lender, not you.

Texas also has a Consumer Bill of Rights for auto insurance; your insurer must give you a copy when you buy or renew a policy.

Fault, claims, and the clock your insurer is on

Texas is an at-fault state. The driver who caused the crash — through their liability insurance — is responsible for the other side's repairs, medical bills, and related losses. There is no no-fault system here, and fault can be shared, which is why evidence matters so much.

At the scene, TDI's advice is practical: swap names, addresses, phone numbers, plate numbers and insurance details (photographing the other card is quickest), collect witness contacts, note time, place, weather and road conditions, and photograph everything. Call police if anyone is hurt, if the other driver leaves, or if they refuse to identify their insurer. That last point has teeth: uninsured motorist coverage won't pay on a hit-and-run you never reported to police.

Deadlines that apply when you claim on your own policy. Under the state's prompt-payment rules, your insurer must:

1. Acknowledge your claim within 15 days of notice (it may ask for a proof-of-loss form, more information, or a medical exam);
2. Have an adjuster inspect the damage and estimate repairs;
3. Accept or reject the claim within 15 business days of receiving everything it needs — or take up to 45 days if it explains the delay in writing. A denial must be explained in writing;
4. Pay within five business days of agreeing to pay.

Those deadlines do not bind the other driver's insurer when it is handling your claim — though that company still has to act in good faith and settle fairly and promptly.

If the other insurer stalls or refuses, you can claim on your own collision coverage (you'll owe your deductible) and let your insurer chase reimbursement. If the at-fault driver's limits run out, your collision, UM/UIM, PIP or medical payments coverage can pick up the gap — one more reason not to reject UM/UIM.

Optional coverage that earns its keep in Texas

• Uninsured/underinsured motorist (UM/UIM). The single most valuable add-on in a minimum-limits state. It covers repairs, replacement of property inside the car, a rental, medical bills for you and your passengers, pain and suffering, and diminished value — and it answers hit-and-runs. TDI says you can usually buy it in set increments; a common rule of thumb is enough property-damage protection to replace your vehicle.
• PIP or medical payments. PIP covers medical bills and non-medical losses like lost wages, regardless of who caused the crash; medical payments covers medical bills only but also applies if you're hurt as a passenger, pedestrian or cyclist. Keeping the default PIP is usually easier than re-adding it later.
• Collision and comprehensive. Comprehensive matters disproportionately in Texas, where hail, flood, flying gravel and animal strikes are routine claims.
• Gap coverage if you owe more on the loan than the car is worth — a total-loss settlement is the car's depreciated value, not your loan balance.
• Towing and labor and rental reimbursement for the inconvenient weeks after a wreck.
• A Mexican liability policy before you drive south. Mexico does not recognize US auto policies; a short-trip endorsement may not satisfy Mexican law.
• A non-owner liability policy if you don't own a car but borrow one often.

What it costs, roughly. Prices here depend on your ZIP code, vehicle, mileage, record and more, so treat averages as orientation only: the NAIC put the average Texas expenditure at $1,727 per insured vehicle in 2023, combining liability, collision and comprehensive. Your own number can sit well above or below that.

Rules Texas drivers trip over

• A new car is only briefly automatic. A newly bought vehicle is covered for about 20 days under your existing policy — an additional car gets the broadest coverage on the policy, a replacement car gets whatever the old car had. Tell your insurer promptly.
• Borrowed cars follow the car, not the driver. If you crash a friend's car, the owner's policy pays first; yours fills the gap if theirs is short or missing.
• Driving for pay is usually excluded. Rideshare trips and paid deliveries generally aren't covered by a personal policy, and neither are company cars you have regular access to, business driving, or racing.
• Credit can affect your price but can't be the only reason. Insurers may use credit-based scores in pricing, yet they may not turn you down or charge more solely because of credit — nor discriminate on race, color, religion or national origin.
• Your claims history is on file. Most insurers pull a CLUE report, and it can raise your price or cost you a policy.
• You pick the repair shop. An insurer can suggest preferred shops but cannot force you to use one. It does only have to pay for parts of like kind and quality — not necessarily manufacturer parts.
• Cancellation and nonrenewal have rules. A company must give 10 days' notice before cancelling, and may cancel in the first 60 days for almost any lawful reason; after that, grounds include non-payment, fraudulent claims, or a suspended licence or registration. Unearned premium must be refunded within 15 days. A policy can't be nonrenewed until it has run 12 months, and a nonrenewal notice must come 60 days ahead for policies bought or renewed in 2024 (30 days for 2023 and earlier). Age alone, weather claims and animal-strike claims are not valid nonrenewal reasons.
• Turned down twice? The Texas Automobile Insurance Plan Association (TAIPA) sells basic liability, PIP and UM/UIM — no collision or comprehensive, and no limits above the state minimum. It costs more than ordinary coverage, and after three years without tickets or accidents your insurer must offer you a policy outside the plan.

Disagreeing with a settlement, and complaining to TDI

Start with the adjuster: say specifically why the estimate or offer is wrong, and back it with written quotes, photos, repair-shop estimates or comparable used-car listings if your vehicle was totalled. Many disputes end here.

If that fails, you have three routes:

1. Appraisal. For disputes about the amount of a loss (not about coverage), you and the insurer each hire an appraiser and the two pick an umpire, whose decision binds both sides. You pay your own appraiser and half the umpire's cost. Appraisal works only against your own insurer — not the other driver's.
2. Complain to the Texas Department of Insurance. Complaints must be in writing and can be filed through TDI's online consumer complaint portal, reachable from <https://www.tdi.texas.gov/consumer/get-help-with-an-insurance-complaint.html>. TDI handles complaints about companies, agents and adjusters, but it is candid about its limits: it cannot decide who was at fault or set the value of your damage. For questions, TDI's help line is 800-252-3439, weekdays 8 a.m. to 5 p.m. Central.
3. Court. Smaller disputes can go to Justice Court, the small-claims court, without a lawyer; you pay filing costs up front and can recover them if you win.

Also worth knowing: TDI does not approve auto rates in advance, but rates must be fair, reasonable and adequate, and the department can require refunds where it finds overcharging. If you were refused, cancelled or nonrenewed, you can ask for the reason in writing — and complain if you think the decision was improper.

Shopping smart in Texas

Comparison is the main lever you control, because each company weights its rating factors differently — driving record and claims history, where the car is garaged (rates vary by ZIP code, and city rates typically run above rural ones), vehicle type, how much you drive and for what, and, at some companies, credit.

A sensible routine:

• Quote identical limits and deductibles everywhere, or the comparison is meaningless.
• Price higher liability limits before you chase discounts. Minimum limits can evaporate in a multi-vehicle crash or when a late-model car is totalled, and the rest comes out of your pocket — or out of a lawsuit.
• Keep PIP and UM/UIM unless you have a concrete reason to reject them in writing.
• Ask for every discount — multi-car, multi-policy, safety and anti-theft equipment, defensive-driving or driver-education courses, a clean record, and usage-based programmes.
• Use TDI's own tools. HelpInsure.com, run with the department, lets you compare companies and shows which ones use credit scores.
• Check your CLUE report once a year so you aren't priced on someone else's mistake.
• Never let coverage lapse. If you get a cancellation or nonrenewal notice, line up the new policy before the old one ends.