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To help provide greater financial protection to drivers on the road, each state in the U.S. has minimum car insurance coverage requirements that you must meet if you want to legally get behind the wheel. What that means is that if you live in the United States and own a vehicle, then you must meet or exceed your state’s requirements for car insurance.
When it comes to coverage types, a minimum car insurance policy typically includes bodily injury liability and property damage liability coverage, and it provides the minimum amount of coverage you must have in that state. However, certain states also require additional coverage types. Minimum coverage car insurance is typically cheaper than a full coverage policy, which provides extra protection for your vehicle, so it can be a way to save on insurance premiums. However, it is usually only available for vehicles without a loan or a lease.
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 unless drivers receive certain driving infractions that require them to file an SR-22 financial responsibility form. Plus, 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 pays toward property damage that you cause to others. For example, if you hit another driver, your property damage liability insurance would help pay for their 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 (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, rehab 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 helps pay your medical expenses following an accident and is not as robust of coverage as PIP can be. It is available in non-PIP states and is considered optional coverage in most states. However, a few states do require drivers to carry medical payments coverage.
The minimum amount of coverage allowed 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
Before deciding to carry minimum coverage car insurance to satisfy your state’s insurance requirements, it is a good idea to review the minimum requirements in your state. Also, remember that you can always purchase more coverage than what is required if you want additional financial protection. It is a good idea to consider getting quotes for multiple coverage levels before choosing the least 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|
|Michigan||50/100/10||Six PIP options: minimum $50,000 for insureds on Medicaid|
|New Hampshire**||25/50/25||25/50 UM
|New Jersey||15/30/5***||15/30 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.
**New Hampshire does not require car insurance, but these are the minimum limits if you buy a policy.
***New Jersey limits are based on the “standard policy” minimum coverage requirements for current coverage. New Jersey’s minimum limits are increasing in January 2023.
States without car insurance requirements
Traditional car insurance is not mandatory in all states. Depending on where you live, there may be alternative options to put down a deposit or post a bond with your state’s DMV, which serves as proof of financial responsibility. If you were to get into an accident, that money would be given to the other driver to compensate them for their losses.
Here are a few of the states that require either a standard car insurance policy or a financial filing:
- 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. The most flexible states for car insurance alternatives are New Hampshire and Virginia.
In New Hampshire, drivers are not required to carry auto insurance, except in cases where they must have an SR-22. In Virginia, drivers can forgo car insurance and pay a $500 uninsured motorist fee, making it the second cheapest state for alternative car insurance.
Keep in mind, though, that buying an insurance policy is still usually the cheapest way to satisfy a state’s financial responsibility law. For example, in Virginia, a minimum coverage policy will cost you an average of $483 per year; that’s $17 less than the fee you’d have to pay to drive without coverage. Most insurance professionals recommend higher limits 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 — can save you from financial devastation should the worst happen.