Minimum Car Insurance Requirements by State [2024]

Whether you’re buying car insurance for your new car or looking to reduce how much you pay each month, understanding minimum car insurance requirements by state is crucial to finding the right policy. However, states require different amounts of coverage, so knowing how much you need can be a bit confusing.

Most states require a minimum amount of liability insurance, while many others require uninsured motorist or personal injury protection coverage. While minimum insurance is your cheapest option for coverage, it’s not always your best bet — many drivers benefit from buying more coverage.

Read on to learn about your state’s minimum insurance requirements and how much it might cost you. Then, compare rates with as many companies as possible to find the best minimum coverage prices.

Minimum Car Insurance Requirements in Each State

Most states require a minimum amount of car insurance before you can register your car or legally drive. Minimum car insurance requirements vary by state, but most drivers are required to buy at least liability car insurance. Many states also include uninsured/underinsured motorist or personal injury protection insurance in their coverage requirements.

Check below for car insurance laws by state and how much you’ll need before you hit the road.

Car Insurance Coverage Requirements by State

As you can see, there is a great deal of variation in insurance requirements between states. States like Michigan and Wisconsin have large insurance requirements, while some states like California are pretty lax (learn more: compare California car insurance rates).

When it comes to buying car insurance, the minimum amount your state requires is your cheapest option for coverage. It doesn’t offer the best protection for your car, but state minimum car insurance offers the lowest prices.

Cost of Minimum Car Insurance by State

As you saw above, there’s significant variation between states when it comes to insurance laws. While minimum insurance is your cheapest option for a policy, the amount you’ll pay depends on where you live. States with higher insurance requirements typically have higher average insurance rates, though many other factors affect prices.

Learn about factors that affect car insurance rates.

To see how much the average price for minimum insurance in your state is, check below.

Average Monthly Liability Car Insurance Rates by State

Although minimum insurance is affordable, it comes with a few financial risks. First, minimum insurance doesn’t cover your car. If you cause an accident, you’ll have to pay for your repairs by yourself. The second risk is that most states don’t require very much insurance, and exceeding those limits is not difficult. If your insurance runs out before everything is paid for, you’ll be left with the rest of the bill.

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Types of Car Insurance Required by States

You saw that states require different types of insurance. The most commonly required type of insurance is liability insurance, but there are a few others some states require. The types of insurance your state might require include the following:

• Bodily injury liability: The first half of liability auto insurance coverage pays for injuries you cause to other people, their passengers, and any pedestrians or bystanders.
• Property damage liability: The other half of liability insurance covers damage you cause to other people’s property, including vehicles and buildings.
• Uninsured/underinsured motorist: Although most states require car insurance, not everyone follows the law. Uninsured/underinsured motorist insurance protects you from drivers without adequate coverage and is required in 20 states.
• Personal injury protection: Personal injury protection covers health care expenses for you and your passengers after an accident, no matter who was at fault. Personal injury protection insurance is required in 16 states (read more: compare personal injury protection (PIP) car insurance).
• Medical payments: Medical payments insurance — or MedPay — is similar to personal injury protection insurance, but it doesn’t cover lost wages. Maine is the only state that requires MedPay insurance.

Read more: How much does PLPD insurance cost in Michigan?

Although these are the only coverages required by state law, many other types of insurance are available. For example, many drivers choose to buy comprehensive and collision insurance to better protect their cars.

States That Don’t Require Car Insurance

Which states do not require car insurance? Most states require car insurance, but there are a few that don’t. Currently, only two states don’t require car insurance before you can start driving:

• New Hampshire: New Hampshire drivers are only required to prove they can pay for the damage they cause in an accident. Drivers with a major violation, such as a DUI or at-fault accident, might be required to buy insurance (Learn more: compare New Hampshire car insurance rates).
• Virginia: Virginia allows drivers to pay an annual $500 uninsured motorist fee instead of buying coverage. However, that leaves you completely responsible if you cause an accident. Since minimum insurance costs about $500 a year in Virginia, most drivers are encouraged to buy coverage. Learn about how to compare Virginia car insurance rates.

Many other states allow drivers to make a large cash deposit with the DMV rather than buy car insurance. Every state is different, but the deposit amounts are usually between $25,000 and $115,000. Due to the large deposit amount and the inconvenience of getting into an accident, most experts recommend getting insurance instead.

Read more:

• Do you get your deposit back from car insurance?
• How much does bankruptcy affect car insurance rates?

Find Affordable Car Insurance in Your State Today

No matter how much state car insurance you need, minimum coverage offers the lowest prices. While understanding how much insurance you need might be a bit confusing, you don’t have to figure it out by yourself — an insurance representative can help.

Although minimum insurance is your cheapest option for coverage, you should still compare as many rates as possible. You’ll see significant variations in rates between different companies, and you’ll likely overpay if you don’t compare rates.

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Case Studies: Understanding Minimum Car Insurance Requirements by State

Case Study 1: The Cost of Minimum Insurance in Michigan

In this case study, we follow John, a resident of Michigan, and examine the high insurance requirements in the state. John opted for minimum car insurance coverage to save on costs. However, when he caused an accident, he found himself responsible for covering the damages to his own vehicle, resulting in unexpected expenses.

Case Study 2: California’s Lax Minimum Insurance Requirements

Sarah, a driver in California, serves as the focus of this case study. With relatively relaxed minimum insurance requirements in the state, Sarah decided to stick with the minimum coverage. Unfortunately, she got into a collision with an uninsured driver, and her minimal coverage couldn’t fully cover the costs of her medical bills. We explore Sarah’s experience and discuss the limitations of minimum insurance in such situations.

Case Study 3: Alternatives to Car Insurance in New Hampshire and Virginia

In this case study, we introduce Mark, a resident of New Hampshire. Mark took advantage of the state’s alternative method by making a large cash deposit with the DMV instead of purchasing car insurance. However, Mark later faced challenges when he got involved in an accident that exceeded the amount of his deposit.

Case Study 4: Mark’s Situation in Texas

Mark, a driver in Texas, was curious about the minimum car insurance requirements in his state. He learned that Texas requires liability coverage of 30/60/25, which translates to $30,000 for bodily injury per person, $60,000 for bodily injury per accident, and $25,000 for property damage per accident. This case study highlights Mark’s journey in securing affordable state minimum car insurance.

The Final Word on State Car Insurance Requirements

Now that you know what auto insurance coverages your state requires, the next step is to start shopping for the best auto insurance coverages and rates in your state.

To get started, use our free quote comparison tool. It will help you find the best companies in your state for auto insurance.

Minimum Car Insurance Required by State

The minimum car insurance required by the state varies, which means costs do, too. North Dakota has the lowest rate at $25 a month, while Florida and New Jersey have the highest at $76 a month. Our insurance experts detail minimum car insurance coverage and how to get cheap state minimum insurance.

The state minimum car insurance meaning describes the insurance requirements to drive in a specific state. However, every state demands something unique for drivers.

But what is the minimum amount of liability insurance required in California and Texas? Is it the same? Don’t worry – we’ll answer your questions.

This guide has everything you need to know about the minimum car insurance required by state, what coverage level is recommended, and how the best auto insurance companies compare in the nation.

Just a popular TV commercial does not mean that a car insurer is right for you. However, stable providers with a long history of service can be safe bets. Some of the most well-known National Car Insurance companies include Allstate, Geico, Progressive, and State Farm.

Continue reading to learn more about the best state minimum car insurance and cheap state minimum car insurance. For state minimum car insurance quotes, simply enter your ZIP code in our free online quote tool to compare multiple insurance companies.

Should I buy liability-only or full coverage car insurance?

It depends on your situation. Liability-only auto insurance is perfect for older vehicles that have values lower than the average cost of total loss repairs.

But if you want total coverage on your car, full coverage car insurance is much better than affordable state minimum car insurance.

Read more: When should I switch to liability-only car insurance?

Can optional car insurance options help me stay covered?

Yes, it can. Optional coverage options, such as rental car reimbursement, collision insurance, and comprehensive coverage, are good coverage options that help cover areas that liability insurance won’t cover.

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Are state minimum car insurance rates more expensive at the top companies?

The average state minimum auto insurance rates increase when you get an insurance quote. Car insurance companies use unique methods to calculate your rates.

But how do these rates look for car insurance customers? Let’s look at the cost of auto insurance at the best companies in the nation.

Monthly Liability-Only Car Insurance Rates by Company

USAA is available to military veterans and people in their immediate families. Therefore, we recommend that you choose Geico, American Family, and Nationwide if you want cheap car insurance.

If you’re eager to shop with smaller, regional auto insurance companies, be sure to secure as many discounts as possible to keep your rates low.

Does commercial car insurance have the same requirements as state minimum car insurance?

No, it doesn’t. Commercial auto insurance requires more.

The minimum amount of liability insurance required for a commercial motor vehicle is between $750,000 and $1 million.

Why is car insurance important?

Since almost every state in the country requires basic car insurance at the very least, the importance of insurance is astronomical. Without it, a driver usually cannot legally drive. Some of the penalties involved with not having car insurance can include:

• Revocation of one’s license
• Huge fines and multiple citations
• Impounding of the driver’s vehicle

Although local car insurance companies do exist, national car insurance is often a good choice because national companies may offer more coverage options.

On top of this, national car insurance covers more situations than local insurance and the discounts a driver can get are much better. Claims are usually easier to initiate and get settlements with national car insurance companies.

If a person doesn’t have car insurance, then they’re bound to have problems with law enforcement. Should they get into an accident, then they will be liable for all damages they cost, which they have to pay for with their own money.

National car insurance companies are the best choice and everyone needs to have an active policy.

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What does car insurance do?

Depending upon the policy and coverage that a driver has, their car insurance will do certain things. With basic coverage, a driver in an accident will be able to cover the damages they cause and be able to fix their own car.

With comprehensive coverage, the driver can protect their vehicle from a plethora of different situations.

Basically, auto insurance covers hundreds of different situations a driver may face or experience, so it’s a form of protection for drivers. Anyone looking for cheap car insurance or looking to switch providers should compare quotes for providers right away.

Read more: How do I change car insurance agents?

Minimum Car Insurance Required by State: The Bottom Line

State minimum auto insurance is just another way of saying liability insurance. Although liability insurance requirements vary by state, most car insurance companies recommend that you buy 50/100/50 coverage limits.

If you’re a high-risk driver, you may need coverage limits as high as 100/300/100.

Read more: Best High-Risk Car Insurance

Before you buy state-minimum car insurance, enter your ZIP code in the free comparison tool below to compare multiple insurance companies near you and find cheap state minimum auto insurance.

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Enter your ZIP code below to view companies that have cheap car insurance rates.

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