Reader’s Question:

I’m still financing my car in Lincoln, NE, am I required to carry comprehensive and collision insurance?

Adam

Lincoln, Nebraska

Under Nebraska law it requires all registered motor vehicles to maintain proof of financial responsibility or commonly called as car insurance. Nebraska Revised Statute 60-346 defines proof of financial responsibility or car insurance stating that it means evidence of ability to respond in damages for liability, during accidents occurring subsequent to the effective date of such proof, arising out of the ownership, maintenance, or use of a motor vehicle, (1) in the amount of twenty-five thousand dollars ($25,000) because of bodily injury to or death of one person in any one accident, (2) subject to such limit for one person, in the amount of fifty thousand dollars ($50,000) because of bodily injury to or death of two or more persons in any one accident, and (3) in the amount of twenty-five thousand dollars ($25,000) because of injury to or destruction of property of others in any one accident.

This means that the state of Nebraska requires you to carry these liability covers on your car. It is not a state law that requires you to keep physical damage coverages of collision and comprehensive on a financed car but instead it typically is the claim holder that mandates these coverages be placed and maintained on the car in Lincoln, NE. In your finance documents usually there is a description on the types of insurance that must be covered and maintained on the car until it is paid off and you become the title holder of the car without a lien holder on it. The leasing or loan company wants their vehicle to be properly covered with these physical damage coverages. If you opt to not place these types of car insurances that your financing company requires, then they can place “forced” insurance on it or may even be able to take the car back.

Tags: auto insurance