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Nearly every state requires its drivers to carry car insurance, and Minnesota is no exception. The insurance laws in Minnesota are relatively straightforward, but there are penalties if you don’t maintain Minnesota’s specific minimum limits. Bankrate has broken down exactly what you need to carry on your insurance policy to comply with Minnesota state law to help you avoid costly fines and suspensions.
Car insurance laws in Minnesota
Although Minnesota car insurance laws are easy to understand, there are several laws that differ from other states. Current Minnesota drivers and individuals who are planning to move to Minnesota should review the laws to make sure they meet the state requirements:
- Car insurance is legally required: Every driver in Minnesota must carry a minimum amount of car insurance. Any car that is registered in the state must be covered, regardless of how often the vehicle is driven.
- Drivers must carry no-fault insurance: Minnesota is a no-fault state, which means drivers are required to carry no-fault insurance, in addition to basic liability insurance.
- Drivers must carry proof of insurance: Drivers in Minnesota are legally required to carry proof of insurance at all times. Physical and electronic proof of insurance documents are acceptable. Drivers must provide proper documentation when requested by law enforcement.
- Your policy can be canceled for non-payment or fraud: Drivers who fail to pay their monthly insurance premium, or fail to disclose certain information to their insurance company, can have their policy canceled at any time.
Liability insurance requirements in Minnesota
Minnesota insurance laws state that all drivers must carry liability insurance. Uninsured/underinsured motorist liability coverage is also legally required in Minnesota. The Minnesota minimum car insurance requirements are 30/60/10, which includes:
- $30,000 bodily injury liability per person
- $60,000 bodily injury liability per accident
- $10,000 property damage liability per accident
- $25,000 uninsured motorist bodily injury per person
- $50,000 uninsured motorist bodily injury per accident
- $25,000 underinsured motorist bodily injury per person
- $50,000 underinsured motorist bodily injury per accident
- $40,000 personal injury protection (PIP)
Drivers who purchase minimum coverage car insurance in Minnesota pay the lowest car insurance rates, on average. However, opting for liability-only coverage is not recommended. Car accidents can be costly, and there is no guarantee that Minnesota’s minimum coverage requirements will cover the full cost of an at-fault crash.
For example, if you cause an accident and the other driver’s vehicle sustains $20,000 worth of damage, you would be responsible for paying the remaining $10,000 out-of-pocket. If the driver was injured and sustained $60,000 in medical bills, you would have to pay the $10,000 not covered by their PIP and your bodily injury liability. See our example in the next section to learn more about how PIP works in a no-fault state.
Minnesota drivers who are considering minimum coverage insurance should also know that liability-only coverage does not include any protection for their vehicle. If you got into an accident and your car needed repairs, you would be responsible for covering the full cost. If you’d like to have financial protection for your vehicle, you will need to add comprehensive and collision, also known as full coverage.
Is Minnesota a no-fault state?
Yes, Minnesota is a no-fault state. No-fault states typically mandate that you carry personal injury protection (PIP), which covers you for medical payments and lost wages caused by a car accident, no matter who is at fault. Each no-fault state sets its PIP coverage limit; in Minnesota, the limit is $40,000. That $40,000 minimum limit will cover up to $20,000 in medical expenses and $20,000 for non-medical expenses (such as lost wages).
Suppose you are in an accident in Minnesota and are deemed not at fault. You sustained $35,000 in injuries, so your PIP is triggered and pays out the maximum of $20,000. After your PIP pays out, you still have $15,000 worth of unpaid medical bills. In that case, the at-fault driver’s bodily injury coverage will pay to take care of the rest.
Penalties for driving without insurance in Minnesota
Driving without insurance in Minnesota is a misdemeanor. After a first offense, the driver’s license will be suspended and the driver will be required to pay a $200 fine. If the driver cannot afford to pay the $200 fine, the court may allow the driver to complete community service instead.
In Minnesota, drivers who get their license suspended are required to purchase SR-22 insurance in order to reinstate their license. Drivers who have their license suspended but do not own their own vehicle can either purchase a non-owners insurance policy or get added to another driver’s existing insurance policy.
Maintaining continuous coverage is vital to avoid costly fines and penalties from the state and protect yourself financially from the unexpected. Fortunately, there are many coverage packages you can choose from, and shopping for the cheapest car insurance in Minnesota can help you work this necessary expense into your budget.
Additional auto insurance coverage options in Minnesota
Most drivers in Minnesota purchase coverage beyond the Minnesota auto insurance requirements. Here are some additional policies that are available in Minnesota:
- Collision insurance: Collision insurance pays for your vehicle’s repairs after an accident. The average cost of collision insurance in Minnesota is around $274 per year.
- Comprehensive insurance: Comprehensive insurance pays for your vehicle’s repairs related to non-accident claims, like falling objects or theft. The average cost of comprehensive insurance in Minnesota is approximately $214 per year, according to the Triple-I.
- Roadside assistance: With roadside assistance coverage, drivers can get access to towing services, battery replacement, fuel delivery, extrication, lockout services and tire replacement.
- Rental car reimbursement: Rental car reimbursement pays for a rental car up to certain limits if your vehicle needs to get repaired following a covered claim. Some insurance companies automatically include this coverage in full coverage policies.
- Gap coverage: Gap coverage will pay off your loan balance if your vehicle is totaled in a covered loss or is stolen. Gap is usually optional, and you may be able to get it through your insurance company or your dealership.
Some of the best car insurance companies may offer additional coverages to those that are listed. When looking for a new policy, you may find it helpful to ask the agent for an overview of their optional coverages, as these can vary from provider to provider.
Frequently asked questions
Car insurance companies use many different rating factors to calculate premiums. Additionally, each company has its own proprietary algorithm to weigh these factors. As such, the best car insurance company in Minnesota will be different for every driver. However, Geico, State Farm and Progressive have the highest Bankrate Scores in Minnesota as of August 2022. If you are shopping for new car insurance, you may want to start with these companies.
The average annual cost of car insurance in Minnesota is $1,692 for a full coverage policy and $600 for minimum coverage. For comparison, the average annual cost for a full coverage policy in the U.S. is $1,771 and $545 for the minimum. This data shows that Minnesota’s average full coverage rate is slightly lower than the national average but somewhat higher for minimum coverage.
There are several ways drivers in Minnesota can save money on car insurance. Practicing safe driving habits, taking steps to improve your credit score and ensuring that you are taking advantage of eligible discounts can bring your premium down. You may also want to shop for new quotes before your renewals to make sure you are getting the lowest rate available.