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Most states in the U.S. have minimum car insurance coverage requirements that you must meet to legally get behind the wheel. At the very least, insurance laws typically mandate drivers to carry bodily injury liability and property damage liability. While the minimum required policy may be cheaper than a full coverage policy, it might not be an option if you loan or lease your vehicle and your bank requires more coverage.
Bankrate’s insurance editorial team, which includes license agents, breaks down the car insurance requirements in each state below.
What kind of car insurance am I required to have?
Nearly all states have some form of car insurance requirement. Many states allow drivers to satisfy minimum requirements in several ways, including through a bond, deposits, evidence of self-insurance or by carrying an auto insurance policy. New Hampshire does not have a car insurance requirement but you do have to prove that you can be financially responsible for damages that you cause before forgoing a policy, and there are minimum limits if you choose to buy coverage. There are several states, like Michigan, Minnesota and New Jersey, where drivers are required to carry liability and personal injury protection coverage.
Below are the coverage types that are often required with minimum car insurance:
- Bodily injury (BI) liability: If you cause an accident with another driver or pedestrian, bodily injury liability coverage will help pay for medical expenses related to the other person’s injuries. It may also cover your legal fees if the other person sues you for their losses.
- Property damage (PD) liability: Property damage liability coverage is designed to pay toward property damage that you cause to others. For example, if you hit another vehicle on the road, your property damage liability insurance could help pay for the other vehicle’s repairs.
- Uninsured/Underinsured motorist coverage (UM/UIM): Uninsured and underinsured motorist coverage offer financial protection in the event that you get into an accident with a driver who is uninsured or does not have enough coverage to pay for your losses.
- Personal injury protection coverage (PIP): Personal injury protection is a requirement in states that have no-fault laws. If you get into an accident, PIP can pay for your medical bills, lost wages, rehabilitation costs and related expenses, regardless of who caused the accident. This coverage can also be purchased in some at-fault states.
- Medical payments coverage (MedPay): Medical payments coverage may help pay your medical expenses following an accident and is not typically as robust as PIP. It is generally considered an optional coverage. However, a few states do require drivers to carry medical payments coverage.
The minimum amount of coverage per person and per accident is different depending on your location. To find the exact minimum coverage requirements in your state, you can visit your state’s Department of Insurance website or contact your auto insurer.
Minimum car insurance requirements in each state
Although insurance carriers will not sell you a policy with less coverage than the state-mandated minimum coverage level, it may still be a good idea to review your state’s minimum coverage requirements. Also, remember that you can always purchase more coverage than required if you want additional financial protection. Most insurance professionals recommend getting quotes for multiple coverage levels before choosing the minimum amount of car insurance coverage available in your state to save on auto insurance premiums.
The table below includes the minimum car insurance requirements in all 50 states and Washington, D.C.
|State||Bodily injury liability and property damage liability||UM/UIM, PIP and MedPay|
|Florida||$10,000 PDL*||$10,000 PIP|
|Indiana||25/50/25||25/50 UM; 50 UIM|
|Michigan||50/100/10||Six PIP options: minimum $50,000 for insureds on Medicaid|
|New Hampshire**||25/50/25||25/50 UM
|New Jersey||25/50/25***||25/50 UM/UIM
|New York||25/50/10||25/50 UM
|North Carolina||30/60/25||30/60/25 UM
|North Dakota||25/50/25||25/50 UM/UIM
|South Carolina||25/50/25||25/50/25 UM|
|South Dakota||25/50/25||25/50 UM/UIM|
|Washington, D.C.||25/50/10||25/50/5 UM|
|West Virginia||25/50/25||25/50/25 UM|
*Florida only requires PDL and PIP, but you have to prove you have the financial means to pay for damages before you can skip out on BI. Minimum BI limits are 10/20 if you do purchase coverage.
**New Hampshire does not require car insurance, but these are the minimum limits if you buy a policy to satisfy the financial responsibility law.
***New Jersey limits are based on the “standard policy” minimum coverage requirements for current coverage. These limits reflect the increase that took place in January 2023. New Jersey’s minimum limits will increase again in January 2026, to 35/70/25 for liability and 35/70 for UM/UIM. PIP will remain at $15,000.
What states do not require car insurance?
Traditional car insurance is not mandatory in all states. Depending on where you live, there may be alternative options, such as putting down a deposit or posting a bond with your state’s DMV, which serves as proof of financial responsibility. If you were to get into an accident, that money could be given to the other driver to compensate them for their losses, depending on the circumstances.
The most flexible state for car insurance alternatives is New Hampshire. In New Hampshire, drivers are not required to carry auto insurance, except in cases where they must have an SR-22. Here are a few other states that provide the option to use a financial filing in lieu of a traditional auto insurance policy:
- California: Option to put down a $35,000 deposit
- Florida: Drivers can decline liability insurance by proving a net worth of at least $40,000
- Montana: Option to post a bond or a $55,000 deposit of cash or securities
However, keep in mind that forgoing traditional car insurance is usually a much more expensive option in the long run or if you are involved in an accident. For example, in New Hampshire, minimum liability insurance costs an average of $321 per year. Although car insurance isn’t required here, drivers are still liable for property and medical damages related to an at-fault accident, which could easily add up to much more than that.
Most insurance professionals recommend higher policy limits than the minimums required by law for greater financial protection, and you may need full coverage depending on your situation. Car insurance is designed to protect your finances from the fallout of vehicle accidents, so having a policy that fits your needs — even if it’s more expensive than the minimum requirements — may save you from financial devastation should the worst happen.
Frequently asked questions
They aren’t actually mutually exclusive. Minimum coverage refers to a state’s required minimum limits, and it’s typically a liability-only policy (although other coverage types may be required). Full coverage just means that you’ve added comprehensive and collision, which add financial protection for damage to your vehicle and are likely required if you have a loan or lease. So you could buy state minimum liability limits and also have “full coverage” by adding comprehensive and collision. Most insurance professionals advise that you buy higher liability limits for more financial protection, but if your budget is exceptionally tight, minimum coverage might be your best option.
Minimum coverage car insurance will help pay for the injuries and property damage you cause if you’re the driver in the at-fault accident. In some states, minimum coverage car insurance also includes PIP and uninsured motorist coverage, which can help pay for your injuries in a variety of scenarios. It’s also important to note that unless your state requires uninsured motorist property damage coverage, minimum coverage car insurance doesn’t pay to repair your vehicle, whether you’re at fault or not at fault. Instead, you’ll need to add comprehensive and collision if you want your car covered.
A full coverage car insurance policy generally includes liability insurance and your state’s other minimum coverage requirements (if applicable), plus collision and comprehensive coverage. Collision insurance covers your vehicle’s repairs after an accident, whereas comprehensive coverage covers your vehicle’s repairs after a non-collision incident, such as theft, vandalism, storm damage or damage from striking an animal.
The cost of car insurance may vary greatly for every driver. The average cost of car insurance in the U.S. is $2,014 per year for full coverage and $622 for minimum coverage, according to Bankrate’s study of quoted annual premiums for 2023, but your rate may be more or less than the average. That’s because the premiums you pay are calculated using a range of personal factors, like your ZIP code, state, claims history, driving record, coverage options and deductibles.
When insuring a leased vehicle, your leasing company will typically require you to carry a minimum of $100,000 per person and $300,000 per accident in bodily injury coverage, and $50,000 in property damage coverage (or 100/300/50). Because the leasing company still technically owns the car during your lease term, it may require these higher-than-minimum liability limits for extra financial protection if you’re deemed at fault in an accident.
In addition to 100/300/50, your leasing company will probably require that you carry comprehensive and collision, and it may restrict how high you can set your deductible. Leasing coverage requirements vary from company to company, so to ensure your policy meets the terms of your lease agreement, you may want to consult with your dealer or leasing company for more information.
Yes, your car insurance policy will cover you anywhere you drive in the United States. Your car insurance policy must meet the coverage requirements in the state where the car is registered. However, there are no restrictions for driving in another state where the minimum requirements are higher; if you drive into a state that has higher minimum limits than yours, your minimum coverage policy will adjust up to that state’s limits. You may even have the same coverage if you drive across the border into Canada. However, you should confirm with your car insurance company or agent that you are covered in Canada prior to driving across the border. Most standard U.S. auto policies do not provide coverage in Mexico.