INSURANCE GUIDE

It is state law to carry auto insurance regardless of where you live in the United States.insurance requirements by state

The amount of insurance you are required to carry, however, varies by state. Each state board comes up with their minimum requirements, and these are designed to ensure that if you are involved in an accident, you can pay for losses.

Despite the requirement, the Insurance Research Council (IRC) estimates that one out of eight drivers were uninsured in 2014.

The reasons for being uninsured vary – from people who cannot afford the policies to those who refuse to insure their car because it is not worth insuring.

Regardless, with compulsory insurance in all 49 states and the District of Columbia, risking driving without insurance puts you financially liable for incidents, but also possibly citations from the state.

Why Insurance is Compulsory in Most States

Most states require that you carry insurance or accept personal financial liability. For example, New Hampshire has no minimum coverage to drive legally, but by driving without insurance you are accepting the cost personally. When you are deemed personally responsible by the state, it means that:

  • You must personally compensate anyone for injuries, medical payments, and vehicle damage in an accident you cause.
  • You must reimburse for property damage caused by your accident.
  • You must pay for your injuries and losses after an accident.

What Most States Require

States will have categories of insurance they require, and the minimums for those categories will vary.

You can expect to pay for:

  • Bodily Injury Liability – This coverage is per person and per accident with maximum limits on both.
  • Property Damage Liability – Coverage is per accident but does not cover your vehicle. It only covers property you are responsible for damages.
  • Personal Injury Protection – Not all states require PIP, but this covers per accident and is limited to medical expenses with a maximum amount allowed.
  • Uninsured and Underinsured Motorist – Again, not all states require this level of coverage. However, those who do define it on a per person and per accident basis.

Most states require property damage and bodily injury, with only a handful requiring all four.

What are the Minimum Insurance Requirements by State?

When looking at minimums, you will notice that they are presented in “20/40/20” format. In this format, it would mean that you are required to carry $20,000 bodily injury per person, $40,000 per accident bodily injury, and $20,000 property damage.

If you want to ensure you are obeying the law, or you want to save and purchase only the minimum, here are the limits to know:

Alabama 25/50/25
Alaska 50/100/25
Arizona 15/30/10
Arkansas 25/50/25
California 15/30/5
Colorado 25/50/15
Connecticut 25/50/25

$25k Underinsured/Uninsured Motorist Coverage per Person and $50k per Accident

Delaware 25/50/10
Florida $10k Property Damage

$10k Personal Injury Protection (PIP)

Georgia 25/50/25
Hawaii 20/40/10

$10k Personal Injury Protection (PIP)

Idaho 25/50/15
Illinois 25/50/20

$25k Underinsured and Uninsured per Person with $50k per accident

Indiana 25/50/25
Iowa 20/40/15
Kansas 25/50/25

$25k Uninsured and Underinsured per Person and $50 per Accident

Personal Injury Protection of $4,500 Medical Expense Minimum

Kentucky 25/50/25

$10k Personal Injury Protection (PIP)

Louisiana 15/30/25
Maine 50/100/25

$50k Uninsured and Underinsured per Person and $100k per Accident

$2k Medical Payment Coverage

Maryland 30/60/15

$30k Uninsured and Underinsured per Person and $60k per Accident

$15k Uninsured and Underinsured Property Damage

Massachusetts 20/40/5

$20k Uninsured and Underinsured per Person and 40k per Accident

$8k Personal Injury Protection (PIP)

Michigan 20/40/10

$1m Property Protection

Unlimited Personal Injury Protection (PIP)

Minnesota 30/60/10

$25k Uninsured and Underinsured per Person and $50k per Accident

$40k Personal Injury Protection (PIP)

Mississippi 25/50/25
Missouri 25/50/10

$25k Uninsured and Underinsured per Person and $50k per Accident

Montana 25/50/20
Nebraska 25/50/25

$25k Uninsured and Underinsured per Person and $50k per Accident

Nevada 25/50/20
New Hampshire *Minimum only if driver opts to buy insurance

25/50/25

$25k Uninsured and Underinsured per Person and $50k per Accident and $25k Property Damage

$1k Medical Payments

New Jersey 15/30/5

$15k Personal Injury Protection (PIP)

New Mexico 25/50/10
New York 25/50/10

$50k Personal Injury Protection (PIP)

$50k Liability for Death

North Carolina 30/60/25

$30k Uninsured and Underinsured per Person and $60k per Accident and $25k Property Damage

North Dakota 25/50/25

$25k Uninsured and Underinsured per Person and $50k per Accident and $25k Property Damage

Ohio 25/50/25
Oklahoma 25/50/25
Oregon 25/50/20

$25k Uninsured and Underinsured per Person and $50 per Accident

$15k Personal Injury Protection (PIP)

Pennsylvania 15/30/5

$5k Medical Benefits

Rhode Island 25/50/25
South Carolina 25/50/25

$25k Uninsured and Underinsured per Person and $50k per Accident and $25k Property Damage

South Dakota 25/50/25

$25k Uninsured and Underinsured per Person and $50k per Accident

Tennessee 25/50/15
Texas 30/60/25
Utah 25/65/15

$3k Personal Injury Protection (PIP)

Vermont 25/50/10

$50k Uninsured and Underinsured per Person and $100k per Accident and $10k Property Damage

Virginia 25/50/20

$25k Uninsured and Underinsured per Person and $50k per Accident and $20k Property Damage

Washington 25/50/10
Washington, D.C. 25/50/10

$25k Uninsured and Underinsured per Person and $50k per Accident and $10k Property Damage

West Virginia 25/50/25

$25k Uninsured and Underinsured per Person and $50k per Accident and $25k Property Damage

Wisconsin 25/50/10

$25k Uninsured and Underinsured per Person and $50k per Accident

Wyoming 25/50/20

The Risks of Bare Minimum Coverage

Yes, if you follow the minimum coverages, you are driving legally in your state. However, the coverage is unlikely to be enough if you were in a severe accident. If you were at fault for the crash, the remaining payments would come from your bank account and assets.

Choosing the bare minimum is a personal financial decision, but one you should talk over with an agent. Consider the cost of replacing or repairing your vehicle, medical payments, and property damage costs of the average collision in your state too.

Sometimes, drivers tweak their coverages to match their needs. They may have minimum property damage but increase the bodily injury coverage or add underinsured and uninsured policies for extra coverage.

Regardless, knowing the minimums is a great starting point. From here, you can add the coverage you need to protect yourself out there on the road today.