New Mexico Auto Insurance Laws

By Robert Karr

  • Overview

    New Mexico Auto Insurance Laws
    In New Mexico, "vehicle insurance" as defined in state law (Section 113 of the Insurance Code) refers to physical damage, public liability and property damage, cargo damage and medical payments when not only automobiles are involved, but also any land vehicle, aircraft or any draft or riding animal. Another section, 59A-18-1, also is involved. This covers all insurance policies or annuity contracts issued in the state as well as risks covered by insurance relating to workers in New Mexico when the employer is not domiciled in the state.
  • The Facts

    New Mexico uses an assigned risk plan in order to divide vehicle insurance among insurers for residents who are not able to get such insurance in the usual manner. Every insurer in the state is required to cooperate in this plan. The assigned risk plan protects consumers from arbitrary and unfair premium charges and also provides a mechanism for filing grievances and appeals. These plans must be filed with the superintendent of insurance in the state for review.
  • Benefits

    State law protects consumers who rent cars from rental companies who may attempt to represent that they will not negotiate with the insurance company who carries the renters insurance. The law requires rental companies to specifically inform the renter on the front page of every rental car contract that if the renter has their own automobile insurance policy, the renter can require the rental company to submit any claims to the renter's company.

  • Considerations

    Automobile owners in New Mexico who outfit their cars with passive anti-theft alarms are entitled to a minimum discount of ten percent on their premiums. An exception is when the automobile manufacturer installs an ignition interlock system as an anti-theft device. In other words, qualified anti-theft systems for the purposes of this discount are only those that automatically are activated when the driver turns off the ignition key.
  • Older Drivers

    Residents who are 55 or older are entitled to an unspecified "appropriate" discount on premium charges if they also complete a course in motor vehicle accident prevention. There are two conditions to this discount, which runs for a three year period. The person who is insured must not have had an at fault accident or be convicted or plead guilty to a moving violation. Also, the provision will not apply if the person is taking the course in order to have a moving traffic violation dismissed.
  • Features

    When medical payments arise under an automobile insurance policy, state law allows the involved party to choose, not only regular doctors of medicine, but licensed doctors of oriental medicine as defined in the New Mexico Acupuncture and Oriental Medicine Practice Act if they so select. If anyone uses a car owned by an auto dealer either as a demo or substitute while their own car is being repaired, the driver's insurance is primary and dealer's insurance can only be used for excess coverage.
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