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UPDATED: Mar 13, 2020
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Car insurance is more than just financial protection in a car accident, it’s a requirement under state law. Every state has different laws pertaining to how much car insurance you need, what vehicles are required to carry coverage and the penalties for driving with no insurance however there are some common features no matter where you live.
What are Minimum Car Insurance Requirements?
Minimum car insurance requirements require drivers not only to carry car insurance but also have a policy in-force with minimum levels of coverage. While these levels are often quite low they do ensure drivers (who comply with the law) have at least some kind of insurance in the event of an accident. These laws help provide a foundation of financial security for all drivers.
How much car insurance am I required to carry?
How much auto insurance you are required to have will depend on a number of factors. For most typical vehicles states require only liability insurance in the forms of bodily injury liability and property damage insurance. However some states also require personal injury protection, uninsured motorist coverage and more. It really depends on where you live.
The most important thing to remember about minimum car insurance requirements is that no state requires comprehensive or collision coverage – the 2 parts of car insurance which provide coverage for damages or injuries to you and your vehicle. Liability insurance is required since it protects the safety and property of other drivers however laws have yet to be created where the government can force you to purchase insurance for your own property. Although in theory this is good it’s also a big problem in the car insurance industry as many drivers simply purchase the cheapest car insurance policy and do not realize the type of coverage they are buying. Without understanding your policy details it’s very easy to be uninsured or underinsured in a car accident.
Before purchasing car insurance always make sure you understand the state minimum requirements and consider a full coverage car insurance policy which consists of liability, collision and comprehensive insurance. Whether or not you ultimately purchase a full coverage car insurance policy it’s critical you understand the different types of insurance.
Why do car insurance requirements vary by state?
Every state has a department of motor vehicles (DMV) and insurance regulation thus car insurance requirements are laws are simply formed at the state level.
Do all vehicles need car insurance?
Surprisingly enough no, however this depends on where you live. Many types of vehicles are excluded from minimum car insurance requirements such as snowmobiles, scooters, classic cars and more but you have to check with your local DMV for the particular requirement in your state. Driving with no car insurance is not just against the law but can result in large fines, driver’s license suspension, vehicle registration suspension and even personal liability in the event of a car accident. Almost all typical vehicles require car insurance.
What is the cheapest car insurance?
The cheapest car insurance is often a policy which only complies with state minimum car insurance requirements and this is one of the biggest reasons why you should never shop for car insurance based solely on premiums. When an accident happens you need the right amount of coverage to protect you and your family from financial suffering and only purchasing the minimum car insurance requirements is nothing more than a small blanket of protection.
There are many ways to find cheap car insurance and affordable car insurance plans which have sufficient coverage but the road starts with understanding auto insurance. View our car insurance guide and then enter your ZIP code and compare car insurance quotes from local providers nationwide.