Every driver should know the required state minimum insurance limits before purchasing car insurance. Insurance agents know this information, but drivers should be aware of it as well.
State minimum auto insurance refers to the minimum amount of insurance all drivers must have in that particular state any time they drive a car. All but a couple of states require liability insurance at some level, and the amounts vary between states.
While only the state minimum limits are required, drivers are often better protected with higher limits.
Auto Insurance Requirements by State
|State||Type of Coverage Required||Minimum Liability Required|
BI – Bodily injury
PD – Property damage
UM – Uninsured motorist
UIM – Underinsured motorist
PIP – Personal injury protection
|25/50/25 = 25,000 in coverage for bodily injury liability per person, |
$50,000 for bodily injury liability per accident, and
$25,000 for property damage liability.
|Connecticut||BI, PD, UI, UM||20/40/10|
|Delaware||BI, PD, PIP||15/30/10|
|District of Columbia||BI, PD, UM||25/50/10|
UM/UIM $50,000 per person
UM/UIM $5,000 PD
|Hawaii||BI, PD, PIP||20/40/10|
|Illinois||BI, PD, UM||25/50/20, UM $25,000/person, |
|Indiana||BI, PD, UM||25/50/10, UM 25/50/10|
|Iowa||BI, PD||25/40/15 Not compulsory, but must prove financial responsibility|
|Kansas||BI, PD, PIP, UM||25/50/15 and PIP|
UM $25/person, $50/accident
Survivor benefits: Disability $900/month and in-home services $25/day for a year, and
$4,500/person medical expenses
$900/month for one year for disability/loss of income
$25/day for in-home services
$2,000 for funeral, burial, or cremation expense
$4,500 for rehabilitation expense
|Kentucky||BI, PD, PIP||25/50/10 and 10 PIP|
|Maine||BI, PD UI, UIM||50/100/25 and $50,000 UM/person, |
$2,000 medical payments
|Maryland||BI, PD, PIP, UM||30/60/15|
|Massachusetts||BI, PD, PIP, UM||20/40/5 and $20,000 UM/person, |
$40,000/accident, $8,000 PIP
|Michigan||BI, PD, PIP||20/40/10|
|Minnesota||BI, PD, PIP, UI, UIM||30/60/10|
PIP $20,00 medical
$20,000 loss of income
|Missouri||BI, PD, UM||25/50/10UM 25/50|
|New Hampshire||Not required||25/50/25 for those who purchase it|
|New Jersey||BI, PD, PIP||15/30/5 and $15,000 personal injury protection|
|New Mexico||BI, PD||25/50/10|
|New York||BI, PD, PIP, UM||25/50/10|
|North Carolina||BI, PD||30/60/25|
|North Dakota||BI, PD, PIP, UM||25/50/25|
|Ohio||Demonstrate financial responsibility or maintain minimum insurance||25/50/35|
|Oregon||BI, PD, PIP, UM||25/50/25|
|Pennsylvania||BI, PD, PIP||15/30/5|
|Rhode Island||BI, PD, UM||25/50/25|
|South Carolina||BI, PD, UM||25/50/25|
|South Dakota||BI, PD, UM||25/50/25|
|Utah||BI, PD, PIP||25/65/15|
|Vermont||BI, PD, UM, UIM||25/50/10|
|Virginia||Not required, but must pay UM fee||25/50/20|
|West Virginia||BI, PD, UM||25/50/25|
What Is Liability Insurance?
Liability insurance applies to many different types of insurance. Auto liability insurance specifically protects other drivers on the road.
There are two sections to auto liability insurance — bodily injury and property damage. Both sections apply when a driver is deemed to be at fault in an accident. Each section has a different purpose. One covers injuries and the other covers property.
In most states, government officials have designated the minimum limits that every driver must purchase to be in compliance with the law. Mandatory car insurance requirements are sometimes called financial responsibility. The reason for this is that there are risks of getting into an accident every time a driver gets behind the wheel.
In the event of an accident, injured parties file a claim with the insurance company of the driver who was at fault, and the insurance company will pay for the loss up to the limits stated on the policy. Drivers must pay out of pocket for any damages that are not covered by insurance.
Together, bodily injury coverage and property damage coverage protect drivers from personal financial loss.
What Is Bodily Injury Coverage?
The bodily injury portion of an auto insurance policy will also cover the loss of income for an injured party if they are unable to work or perform their job functions because of their injuries. In some cases, car insurance companies will pay a certain amount for emotional distress or suffering because of an accident. In the event of a death caused by an accident, an insurance company will also pay for associated funeral costs.
Bodily injury liability pays for claims where the driver was deemed at fault in the accident and another party was injured. This coverage pays for the person’s emergency room, hospital, and other medical bills for any injured party. This portion of the policy also pays for legal defense costs and court costs in the event of a lawsuit.
The bodily injury portion of the policy must have the required minimum state limits, but many drivers choose higher limits to give themselves better protection. In most cases, insurance agents recommend their clients purchase higher limits than the state minimum.
Bodily injury does not pay for everything, though. It does not pay for the driver’s medical expenses for injuries or their lost income for claims related to accidents they cause.
What Is Property Damage Insurance?
The property damage portion of liability pays for damages to someone else's property. It covers other people’s cars, even if more than one car was involved in the accident.
For example, if a driver crashed into the rear end of another car, the driver’s policy will pay a body shop to restore the other car to its previous condition under this portion of the policy.
In another example, if a driver rear-ended a car and that car hit the car in front of it, causing a chain reaction accident involving three cars, the property damage portion of the policy would still pay for the damaged vehicles. In this scenario, the driver’s car would not be covered under the property damage portion of the policy. However, the driver would have coverage under the collision portion of the policy if they purchased that coverage.
Each policy also has specified limits for the property damage portion of the policy. Any damage that is over the property damage limit shown on the policy becomes the responsibility of the insured driver. For this reason, insurance agents typically recommend drivers purchase more than the state minimum property damage limits to protect the insured.
Penalties for Driving Without Insurance
Besides the fact that it is legally required to maintain and enforce an auto insurance policy in most states, those who drive without the required insurance are at risk of penalties.
Whenever a driver gets into an accident or gets stopped by a police officer, the first thing they need to do is show their driver's license and proof of car insurance. Drivers who cannot produce these two items will most likely get a ticket. Depending on the circumstances, a police officer could also suspend a driver’s license or car registration until the driver can provide proof of insurance or financial responsibility of some kind.
Moreover, a police officer could arrest a driver for severe infractions such as reckless driving or driving under the influence. Police officers could also have the car towed for any reason if they choose.
In the best-case scenario, police officers will give drivers a certain number of days to produce a driver’s license and proof of car insurance that shows at least the state minimum limits.
Repeat offenders may be required to take a defensive driving course and possibly take an examination before they can resume driving. In certain cases, drivers may need SR-22 auto insurance with the state to ensure they maintain proper car insurance coverage while driving.
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Frequently Asked Questions
Is auto insurance required by law?
In all states except New Hampshire and Virginia, drivers must have car insurance. In New Hampshire, drivers must purchase the state minimum limits if they choose to purchase car insurance. In Virginia, drivers are not required to purchase car insurance, but they must pay an uninsured motorist fee if they choose not to buy it. In all other states, drivers must purchase the state minimum required limits.
Does my insurance company know what the state’s minimum coverage is?
Yes, all insurance companies are aware of what the state’s minimum required limits are. They do not sell car insurance coverage in lower amounts. It is not in a driver’s best interest to drive with lower limits than the state requires. It is nearly always better for drivers to choose higher limits than the state minimums even though that will increase the insurance premiums.
Car accidents happen every day, and some of them can cause serious injuries or extensive property damage. Even a small fender-bender can result in car damage or injuries.
Car insurance protects drivers as much as it protects their passengers and other drivers on roadways. The best car insurance policies meet a driver's needs for bodily injury and property damage; they may also cover the driver's car. Car insurance policies can also offer supplemental coverages to protect drivers even more.
Overall, the best car insurance company will make the process easy and offer you the best coverage with an attractive premium.
Benzinga helps sort out the confusion for drivers looking for a good car insurance policy.