Hawaii Car Insurance: A Beginner’s Guide

Finding a company from which to purchase car insurance is almost absurdly simple; it seems every time you turn around there is another advertiser claiming they can save you the most money on your car insurance, offering you the maximum amount of coverage for the minimum amount of premium. These companies can be found in the phone book, on the internet or on the nearest billboard. But how do you know how low you can go?

Every state has its own requirements pertaining to the amount of coverage each driver must possess for their vehicle, and HI is no exception. A full explanation of Hawaii’s insurance policies may be obtained from the Hawaii Department of Commerce and Consumer Affairs in Honolulu, http://www.hawaii.gov/dcca/areas/ins, or by calling (808) 586-2790 .

HI is a no fault state, which means that in the event of an accident each driver’s medical expenses will be covered by their own insurance company, regardless of who was responsible. Each driver must possess PIP (personal injury protection) coverage which will cover their medical expenses in case of an accident. Those individuals with good health care insurance will probably not find it necessary to carry more than the minimum amount of PIP insurance.

Since there are some exceptions to the no fault policy (medical expenses in excess of established amounts) motorists are also required to carry liability insurance. Liability will pay for damages to the body and vehicle of the driver not at fault in an accident. In Hawaii motorists are required to carry liability to the tune of twenty thousand dollars for bodily injury suffered by a single occupant of a car, forty thousand dollars for the combined medical expenses of all of the occupants of the car, and ten thousand dollars for any property damage resulting from the accident, including the vehicle of the other driver, fences, mailboxes and public property. The driver responsible for the accident will be held responsible for any expenses beyond this point.

While it is not required all drivers in Hawaii are urged to carry more than the minimum amount of liability, as well as a comprehensive insurance policy. Comprehensive insurance will pay for damages suffered by the vehicle of the driver responsible for the accident up to the value of the car; after that the car will be declared totaled and the cash value of the car awarded to the driver. If the value of the car is less than the amount remaining on its lien the owner may be eligible to purchase what is known as “gap coverage”; this is intended to bridge the gap between the value of the car and the balance of the lien.

In addition to a comprehensive policy it is strongly recommended that all drivers carry an uninsured/underinsured motorist policy. While the state requires that all drivers carry insurance not all are willing to comply, and even with the no fault policy a resident involved in a hit and run or an accident with a driver who either does not carry insurance or whose insurance is very poor may be left with a huge financial responsibility.