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Colorado law requires all drivers to carry minimum levels of car insurance. Motorists caught driving without auto insurance can face fines and the loss of their driving privileges. But legal requirements aside, buying car insurance makes good financial sense, because a well-rounded policy can help protect your finances if you cause an accident.
Looking at Colorado crash data, it’s clear how important auto insurance is to residents in this state. In 2020, the Colorado State Patrol reported 268 fatal crashes, most of which involved excessive speed, driving under the influence or lane violations. There were nearly 93,000 traffic accidents in the Centennial State in 2021, up from under 87,000 in 2020. Given the risks that drivers face on the road, it’s important for every Colorado driver to understand state insurance laws before getting behind the wheel.
Car insurance laws in Colorado
CWhether you are a current Colorado driver or are planning a move to the state, knowing the regulations around car insurance is helpful. Here are the Colorado car insurance laws:
- Minimum coverage: State law requires all Colorado drivers to carry a minimum of $25,000 in bodily injury liability coverage per person and $50,000 per accident. Motorists must also carry $15,000 in property damage liability coverage per accident. You may see these coverage levels expressed as 25/50/15.
- Proof of insurance: Drivers in Colorado must also carry proof of insurance in their vehicles and present it when requested by law enforcement.
- Vehicle registration: To register a car with the Colorado Department of Motor Vehicles, the vehicle owner must provide proof of insurance.
- Self-insurance law: Colorado residents who own more than 25 cars registered in their names can qualify for self-insurance. Candidates can apply for a certificate of self‑insurance from the Colorado State Insurance Commissioner.
Liability insurance in Colorado
In Colorado, drivers are legally required to carry a minimum amount of liability insurance. If you cause an accident, liability insurance will pay for the other driver’s losses, like vehicle damages and medical expenses. It may also cover legal fees if another driver sues you.
The Colorado auto insurance requirement is 25/50/15. Here is what Colorado’s minimum car insurance requirements include:
- $25,000 in bodily injury liability coverage per person
- $50,000 in bodily injury liability coverage per accident
- $15,000 in property damage liability coverage per accident
Purchasing liability-only coverage can keep your insurance premium low. However, minimum coverage insurance might not offer sufficient protection in the event of an at-fault accident. Car accidents can be expensive and can lead to high out-of-pocket expenses.
For example, if you cause an accident that results in $30,000 in property damage, and you only carry the mandated minimum of $15,000 in property damage liability coverage, you would be responsible for paying the remaining $15,000. If you cause an accident that seriously injures another driver and they walk away with $50,000 or more in medical bills, you would be on the hook for costs that exceed your policy’s bodily injury liability limit.
Another aspect to consider is that minimum coverage insurance does not offer any protection for your vehicle. If you accidentally hit your neighbor’s mailbox and your front bumper falls off, you would be responsible for 100% of the repairs. Minimum coverage insurance also does not cover hit-and-runs, theft or vandalism.
Is Colorado a no-fault state?
When it comes to auto insurance laws, states fall into one of two categories: fault or no-fault. In no-fault states, drivers’ auto insurance companies automatically cover their medical expenses and lost wages after an accident, regardless of who caused the crash. In fault states, the at-fault driver’s insurance company covers the other driver’s medical bills.
Colorado is not a no-fault state. So, after an accident, the at-fault driver’s insurance company will pay for the other person’s medical bills.
Penalties for driving without insurance in Colorado
In Colorado, driving without car insurance is illegal, but data shows that 16.3% of Colorado drivers are uninsured. If you get caught driving without insurance, or without the required level of coverage, be prepared to face steep penalties.
Drivers caught without insurance could face a $500 fine for the first offense, and their license may be suspended until they can provide proof of insurance. For a second offense, the fine increases to a minimum of $1,000 and a four-month license suspension.
After three or more offenses, drivers will pay a minimum fine of $1,000 and their license can be suspended for eight months. Depending on the circumstances, some drivers must also perform up to 40 hours of community service, in addition to the fine and license suspension.
Colorado drivers who get their license suspended may be required to obtain an SR-22 form to get their license reinstated. Insurance companies that specialize in high-risk auto insurance typically offer SR-22 certificates.
Additional auto insurance coverage options in Colorado
Colorado insurance laws only require liability coverage. However, many Colorado drivers purchase additional coverages for more protection. Here are some other insurance coverages that Colorado drivers should consider:
- Collision insurance: Collision insurance pays to repair your vehicle after a covered accident. It may also cover damages from hitting stationary objects and rollovers. The average cost of collision insurance in Colorado is $332.26 per year, according to the Insurance Information Institute (III).
- Comprehensive insurance: Comprehensive insurance covers non-collision damages to your vehicle. Examples include theft, vandalism, falling objects, flooding and fire. The average cost of comprehensive insurance in Colorado is $298.01 per year, according to the III.
- Roadside assistance: Roadside assistance typically provides, towing, fuel delivery, tire replacement and battery services. Roadside assistance is typically inexpensive, and many major car insurance providers offer it.
- Gap insurance: Gap insurance may be a good option for drivers who have a new leased or financed car. If your car gets totaled in a covered accident, gap insurance will cover the difference between its current value and the remaining loan balance.
Frequently asked questions
Finding the best Colorado car insurance company might depend on the type of vehicle you want to insure, the coverages you need and how much you can afford to pay. It may benefit you to shop around for auto insurance and request quotes from several companies. When comparing quotes, you may want to evaluate each insurer’s coverages, discounts and rates. It may also benefit you to make sure that each company you’re considering is financially sound.
There is not one company that offers the cheapest car insurance in Colorado for every driver. That’s because auto insurance rates vary and are calculated based on numerous factors, such as the type of vehicle you drive, your driving record and your location. A provider might offer low rates to one driver and much higher rates to another based on these individual factors. That’s part of why it is important to shop around.
Nationwide, American car owners pay an average of $1,771 per year for full coverage and $585 per year for minimum coverage. Coloradans pay, on average, $2,109 per year for full coverage and $495 per year for minimum coverage. It’s important to understand, though, that your rate will likely differ from the average, as car insurance rates are unique to each driver.