Maine law mandates auto insurance coverage for all drivers. The Bureau of Insurance, under the Department of Professional and Financial Regulation (PFR), oversees the insurance industry, protects consumers, and regulates the marketplace. Meanwhile, the Bureau of Motor Vehicles (BMV) enforces insurance regulations during the vehicle registration process.
The bureau educates drivers about their rights to claim insurance and responsibilities to report accidents. It also investigates complaints, evaluates rates, and conducts audits to maintain a fair insurance environment.
The Maine bureau coordinates with national organizations, such as the National Association of Insurance Commissioners (NAIC), to contribute to establishing industry standards and best practices.
Drivers must carry proof of insurance and present it when requested by law enforcement. Failure to maintain proper coverage can result in fines, license suspension, and other penalties. Thus, vehicle owners must understand these laws and adhere to the requirements.
What are the Auto Insurance Requirements in Maine?
Maine law mandates specific minimum coverage for vehicle owners and operators. Drivers must present proof of insurance to register their vehicles. Here are the insurance options available:
Liability Coverage
Liability coverage is designed to protect drivers if found responsible for causing an accident that results in bodily injury or property damage to others. The state mandates specific minimum liability coverage limits, which are as follows:
- $50,000 per person for bodily injury
- $100,000 per accident for bodily injury
- $25,000 for property damage
Alternatively, Maine allows for a combined single limit of $125,000. This limit can cover bodily injury and property damage liability claims from a single accident.
Medical Payments
A minimum of $2,000 per person in medical payment coverage is mandatory. This insurance covers medical expenses for the policyholder and passengers. Other limits of $5000, $10000, and $25000 are available for drivers who want a greater safety net.
Uninsured/Underinsured Motorist (UM/UIM) Coverage
State law requires UM/UIM coverage of $50,000 per person and $100,000 per accident. This coverage protects policyholders against drivers without insurance or insufficient coverage. It covers medical expenses, lost wages, and other damages from the accident.
Other Auto Insurance Options in Maine
While not mandated by law, additional coverage protects drivers from various risks. Higher liability limits are often recommended for better financial protection. Lienholders may require some of these for financed or leased vehicles.
Collision Coverage
This covers repairing or replacing the policyholder's vehicle if it is damaged in an accident, regardless of who is at fault. Collision coverage is particularly valuable for newer or more expensive vehicles.
Comprehensive Coverage
Comprehensive coverage protects against non-collision-related damage to the vehicle, such as theft, vandalism, fire, natural disasters, and falling objects. It also covers the vehicle from a wide range of potential risks.
GAP Insurance
For leased or financed motor vehicles declared as a total loss, gap insurance covers the amount of the vehicle's actual cash value (ACV) that differs from the remaining balance on the loan or lease. This ensures the policyholder is not left owing money on a vehicle they can no longer use.
How To Choose the Right Auto Insurance in Maine?
Navigating the auto insurance landscape requires careful consideration. Drivers should explore key factors in selecting the right coverage. Here are some factors they should use to evaluate the best fit for their insurance needs.
Check Insurance Company Ratings
The PFR assists with auto coverage questions. Consumers can access information through public libraries, consumer groups, and online resources to make informed decisions about their auto insurance.
Moreover, the department has a list of independent organizations that perform insurance company ratings. Websites offer these ratings by measuring a company's strength and stability. Drivers should review these ratings before purchasing coverage.
However, consumers should note that these companies are not connected to the bureau. Thus, they can request the insurance bureau to review and investigate if they find something unusual in how these ratings are derived and made.
Select Licensed Insurers
Consumers should confirm agent and insurer licenses before purchasing. Unlicensed entities offer no guarantee of protection. Thus, residents should check a provider's license status online or contact the bureau for more information before buying.
The PFR also has other tools to check licenses and any disciplinary actions imposed on a company or an individual. This verification helps residents make safer and more informed insurance decisions.
Compare Policies and Quotes
Maine offers a list of sample policies from the top 10 insurance companies. Drivers can review these to understand coverage options. Note that this list is not a recommendation but should be treated as a source of information on how insurance drafts their policies.
Moreover, they should obtain several premium quotes from different insurance providers. They should provide consistent information about the following:
- Vehicle details
- Usage patterns
- Mileage
- Driver's license number
- Other household drivers
- Desired coverages and limits
This approach allows for accurate comparisons between insurers' products. Consumers should remember that the insurance industry uses technical terms. Finding a glossary of insurance terms can demystify policies for drivers.
Ask for Local Recommendations
Residents should check newspapers and phone directories for local companies. Asking neighbors and friends about their experiences provides valuable insights into pricing and service quality.
A company with excellent customer service makes claiming easy. Furthermore, they should be able to answer any questions without delay, especially during critical moments.
What Factors Affect Auto Insurance Rates in Maine?
The state has a cost advantage in the auto insurance landscape. The NAIC ranks Maine as the second-least expensive state for car insurance. This favorable position offers drivers potential savings compared to residents of other states when purchasing auto coverage.
Still, auto insurance rates depend on various factors. These include territory, demographics, vehicle characteristics, driving history, and financial standing. Consumers should know that even though these insurance providers use these standards, some factors weigh more than others.
Thus, understanding these elements helps consumers customize their auto insurance.
Driving Record
A driver's record significantly impacts auto insurance rates. Insurers review the applicant's history, including accidents and moving violations from the past three to five years. Drivers with previous violations or at-fault accidents pose a higher risk, resulting in higher premiums. Clean records often qualify for lower rates.
A clean driving record often averages $1,462 in annual premiums for full coverage. On the other hand, drivers with speeding convictions are slightly higher by $300, and operating under the influence (OUI) or driving under the influence (DUI) conviction results in an average of $2,676.
Territory
Auto insurers consider the vehicle's garage location when calculating premiums. Urban areas like Portland or Bangor usually see higher rates than rural regions. A driver's location reflects the increased risk of accidents, theft, and vandalism in densely populated zones.
Insurance companies analyze claim patterns across Maine localities to assess risk and adjust rates accordingly.
Demographics and Risk
Insurers use statistical data to assess risk based on gender and age. Young male drivers often face higher premiums due to their higher accident rates. Age groups with more frequent claims see increased rates. Maine's rural nature may influence these factors differently compared to urban states.
The average insurance rates for those under 20 range from $3,014 to $4,805, with 18 having the highest premium among the age groups. However, these rates are significantly lower when parents bundle the insurance with their own coverage.
As a driver ages and becomes more experienced, insurance premiums often drop to almost 50%. However, these rates are still analyzed in conjunction with driving records.
Marital Status
Insurance providers consider marital status when calculating premiums. Married policyholders typically enjoy lower rates due to their statistically fewer claims. This factor may interact with Maine's older-than-average population, potentially affecting overall rate distributions across the state. Insurance companies continuously analyze claim patterns to refine their pricing models.
Vehicle Mileage and Purpose
Annual mileage affects insurance premiums, with higher mileage increasing rates due to greater claim exposure. In addition to mileage, insurers consider the vehicle's primary use to be commuting, pleasure, or business. Each situation carries different risk levels.
While carpooling is generally acceptable, participation in ride-sharing services or peer-to-peer car-sharing voids coverage.
Prior Insurance Coverage and Claim History
Insurance providers, including all household drivers, examine applicants' claim history from the past three to five years. Prior insurance status can affect rates. Thus, drivers with coverage lapses or previous cancellations may face higher premiums.
Insurance companies often verify this information with previous underwriters to accurately assess risk and determine appropriate rates.
Vehicle Model
The make and model of a vehicle also influence auto insurance rates. Cars with higher claim frequencies or repair costs have higher premiums for comprehensive and collision coverage.
The severe winter conditions and extensive rural road network significantly influence insurers' risk assessments for various vehicle types. Factors like ground clearance, all-wheel drive capability, and safety features become crucial considerations.
Underwriters may favor sturdy vehicles better suited to navigate icy roads, heavy snowfall, and remote areas with limited emergency services.
Licensed Occupants
Most underwriters require policyholders to list all licensed drivers in the household, which includes current drivers and those who may soon obtain licenses.
The state's definition of "license" encompasses operator's licenses, driver's licenses, and other motor vehicle operation permits. This comprehensive approach helps insurance companies accurately evaluate household risk.
When parents bundle their insurance with their kids who have a driver's license, the premiums are lower by almost $1,000.
Credit Score
Insurance providers may review applicants' credit history to determine policy eligibility and premiums. If credit affects an unfavorable decision, insurers must inform applicants how to obtain their credit report. Residents should review these reports for accuracy, as errors could impact their auto insurance rates.
The insurance rate for a poor credit score is almost 16% higher than the rate for a good credit score. On average, the annual premium is $3,156.
How To Save Money on Auto Insurance in Maine?
Drivers face unique challenges in managing auto insurance costs. Here are some cost-saving techniques consumers may consider.
Install Safety Features
Equipping vehicles with advanced safety features can significantly reduce insurance premiums. Insurers offer discounts for airbags, anti-lock brakes, and automatic seat belts, which prevent accidents or mitigate their severity.
Additionally, anti-theft devices like alarms or GPS trackers deter crime, lowering claim frequencies. These protective measures allow insurers to offer substantial savings to proactive customers.
Maintain a Good Record
Low-risk drivers who renew their policies receive loyalty discounts. Moreover, maintaining a good credit score through timely bill payments can lower rates.
An excellent credit score often leads to lower insurance premiums, with savings of almost 14%. As for loyalty discounts, the total percentage still depends on the provider's overall financial condition.
Check Discounts
State law mandates insurance discounts for 55 and older drivers who complete approved accident prevention courses. This applies to liability, medical payments, and collision coverages. The BMV provides course information. Discounts last 36 months and require course renewal every three years.
Seniors must maintain clean driving records to qualify for discounts. At-fault accidents, moving violations, or license suspensions in the past three years may disqualify household members from these savings.
Besides, many providers offer reduced rates when residents bundle auto and homeowner policies. This combined coverage often results in significant savings for policyholders.
Some insurers offer "Good Student Discounts" to students with driving licenses who maintain a B average or higher. Others offer distant student discounts for parents who include their children in the policy but are studying in college and away from home.
Participate in Driver Education Courses
The BMV offers defensive driving courses that can reduce points for certain violations, like speeding. These five-hour classes teach hazard avoidance and improve driving skills. Costs may vary. Drivers under 65 pay $40, and seniors pay $25. Completing a course can remove up to three points from driving records.
Insure Multiple Vehicles
Discounts are available to consumers to insure multiple cars under one policy. This practice benefits companies and customers, as multi-car policyholders typically file fewer claims. Families can maximize savings by consolidating their vehicles under a single insurer.
Parents of young drivers can reduce costs by adding them to existing policies rather than purchasing separate coverage. This approach can save up to 62% for 18-year-old drivers. However, most insurance companies require the young driver to reside at home with parents for eligibility.
Increase Deductibles
Raising deductibles on collision and comprehensive coverages can lower drivers' premium rates. However, policyholders should only increase deductibles to amounts they can comfortably pay out-of-pocket when filing claims.
Protect Vehicle From Weather Damages
Maine's harsh winters can damage vehicles. Some insurers offer discounts to drivers who garage their cars during winter months. This practice protects vehicles from severe weather and may lead to reduced premiums.
What To Do After an Auto Accident in Maine?
Accidents in Maine average 17,000 occurrences annually. Although most crashes don't result in injury or fatality, drivers must still know what to do when an accident occurs.
When in an accident, drivers should calm down and assess the severity of the situation. They must immediately call 911, a first responder, or a police officer.
The law requires that drivers report all accidents resulting in bodily injury or apparent property damage of $2,000 or more. Drivers must also notify the police immediately in cases involving a hit-and-run driver or even minor accidents.
Following a motor vehicle accident, uninjured drivers should quickly gather essential information. This includes writing down all involved parties' names, addresses, and license numbers. Drivers should note the names and addresses of potential witnesses.
A detailed description of the vehicles involved, including any damage, should be accounted for. Weather conditions and visibility during the accident are crucial details to record.
Thorough documentation of the accident scene, including photos if possible, can greatly assist in the claims process. Drivers should record all communications with the police and other involved parties.
Drivers should request a medical examination after an accident even when injuries are minor. Some injuries or contusions may not be visible, and prompt medical care can prevent complications.
How To File an Insurance Claim?
When filing a claim, policyholders have specific responsibilities outlined in their auto policy's "Conditions" section. Failing to comply with these terms could result in denial of coverage or even policy cancellation. Understanding and following these responsibilities is crucial for maintaining insurance protection.
Promptly contacting one's insurance company or agent to report the accident and claim is critical. Many insurance companies offer 24-hour claims service to facilitate this process.
Drivers should record all communications with insurers, adjusters, and other involved parties. This includes keeping a log of phone calls, emails, and letters. It is also advisable to take photos or videos of vehicle damage before repairs.
Vehicle Evaluation and Repairs
Before repairing or disposing of a damaged vehicle, drivers should allow their insurance company to inspect and appraise it. This step facilitates a fair assessment of the damage and appropriate compensation. However, insurance providers cannot require the use of specific repair services, a practice known as "steering."
The state law protects drivers' rights regarding repairs. Drivers have the freedom to choose their preferred repair shop.
If a vehicle is deemed a total loss, the insurer calculates its ACV based on factors like mileage, condition, and prior damage. Resources such as the National Automobile Dealers Association (NADA) guide or market value can establish fair value.
Claims Settlement
Several factors come into play when dealing with auto insurance claims. A settlement with the at-fault driver's insurer is necessary for ongoing medical care or lost wages before payment can be issued.
However, policyholders have the right to refuse a settlement if they believe it inadequately compensates for the medical, lost wages, or vehicle repair or replacement costs.
Most policies include an appraisal clause in cases of a dispute over loss amounts. This process involves each party selecting an appraiser, with an umpire making the final decision if the appraisers cannot reach an agreement.
If this step fails to resolve the dispute, policyholders can seek assistance from the PFR. While the PFR can provide general information and help with potential insurance law violations, they cannot act as legal representatives or resolve disputes based solely on conflicting testimonies.
As a last resort, policyholders can file a formal complaint if they believe they've been subject to unfair practices. This step ensures that their concerns are officially recorded and may lead to further investigation or resolution.