Insurance Requirements Flashcards
7 cards from real Motor Vehicle Division practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.
Read the first 7 Insurance Requirements flashcards as text
What does liability insurance cover in an auto insurance policy?
Answer: Damage and injuries you cause to others in an accident
Liability insurance covers bodily injury and property damage that you cause to others, not damage to your own vehicle.
What is the primary purpose of uninsured motorist (UM) coverage?
Answer: To protect you when hit by a driver with no insurance
Uninsured motorist coverage protects you when you are involved in an accident caused by a driver who has no auto insurance.
Which document is commonly accepted as proof of insurance when requested by law enforcement?
Answer: Insurance identification card
An insurance identification card issued by the insurer is the standard document used to prove financial responsibility to law enforcement.
What is a common consequence of driving without proof of insurance?
Answer: Fines, license suspension, and possible vehicle impoundment
Driving without insurance typically results in fines, possible license suspension, and vehicle impoundment, depending on state law.
In auto insurance, what does a '25/50/25' policy limit mean?
Answer: $25,000 per person bodily injury, $50,000 per accident bodily injury, $25,000 property damage
The 25/50/25 notation means $25,000 per injured person, $50,000 per accident for all bodily injuries combined, and $25,000 for property damage.
When is an SR-22 form typically required?
Answer: After certain traffic violations or license suspensions to prove financial responsibility
An SR-22 is a certificate of financial responsibility filed by an insurer with the state, typically required after DUIs, serious traffic violations, or license suspensions.
What is 'no-fault' auto insurance?
Answer: A system where each driver's own insurer pays their losses regardless of who caused the accident
In no-fault states, each driver's own insurance pays for their medical expenses and lost wages regardless of who caused the accident, limiting the right to sue.