• Liability insurance is the minimum required coverage for all drivers in Texas.Vecchia auto image by Alpapiro from Fotolia.com
  
  Texas law requires anyone operating a motor vehicle to have proof of financial responsibility in the vehicle at all times. This proof must satisfy the minimum financial criteria defined by state insurance laws. A basic liability insurance policy satisfies state requirements.
  
  

Minimum Coverage

• Liability insurance policies must include a minimum amount of coverage for medical bills and vehicular damage of the other party. These minimum standards are $25,000 for property damage and $25,000 per person in medical coverage, with a maximum of $50,000 in medical per incident. These requirements are scheduled to increase on January 1, 2011. At that time, the property damage requirement will remain at $25,000, but the medical coverage will be increased to $30,000 per person, with a maximum of $60,000 per incident.
  
  

Proof of Coverage

• All insurance providers will provide policyholders with a proof of insurance card. This card must be in the vehicle at all times. Law enforcement officers will ask to see this card during routine traffic stops. You will also need to show it whenever you register the vehicle, have the car inspected or renew your drive'rs license. The state also maintains a computerized verification system known as TexasSure. This network allows law enforcement officers to instantly verify insurance coverage in the event that an insurance card is lost or has lapsed.
  
  

Penalties for No Coverage

• There are penalties for driving without insurance in Texas. A first offense brings a fine ranging from $175 to $350. On subsequent occasions, the fine will be raised to $350 to $1,000. Habitual offenders could also have their driver's licenses suspended or have their cars impounded.
  
  

Consumer Bill of Rights

• Texas law requires insurance companies to provide all liability insurance policy holders with a summary of their rights and responsibilities. This summary must be labeled as the “Consumer Bill of Rights.” It is the responsibility of the insurance agency to update this summary each time the law changes.