Do all cars have to have a certain amount of required auto insurance ...
From the time the automobile was invented, drivers have had to deal with the risk of accidents. It soon became clear that the statutes requiring at-fault parties to assume financial responsibility for damages they caused were not adequate to address automobile accidents. Individual states began enacting laws that required drivers to prove they had the assets to pay for damages if they were at fault.
Eventually, most states passed laws requiring drivers to carry certain types of automobile insurance. Although each state has different requirements, the amounts of coverage are typically the same for all cars and all drivers within the state. Knowing the minimum coverage and finding the right coverage can be confusing. Enter your ZIP code into our FREE car insurance comparison tool right now to see quotes for different levels of coverage.
Types of Car Insurance Coverage
In most states, drivers are allowed to choose the types of coverage they wish to purchase. Certain coverages, however, are mandatory. Vehicle owners typically need to provide proof of auto insurance coverage to register their cars. In some states, if the Department of Motor Vehicles receives notice that a policy has been canceled, it may revoke the registration or suspend the owner?s license.
- Liability: Virtually all states require drivers to carry liability insurance. The minimum policy limits vary by state, and in some jurisdictions, drivers with a history of driving while intoxicated must carry higher limits. Liability is composed of bodily injury and property damage protection, but it does not pay for damages suffered by the policyholder.
- Uninsured/Underinsured Motorist: Despite the laws, some drivers fail to even purchase cheap auto insurance or they purchase policies with limits that are insufficient to cover a serious accident. This type of coverage pays the policyholder for damages caused by an uninsured or underinsured motorist. In most states, the coverage is optional, but a few states drivers to purchase it with their liability policies.
- Personal Injury Protection: Personal injury protection pays the medical bills for the policyholder and his passengers, up to the policy limits, regardless of who is at fault for the accident. The coverage is not offered in all states; it is mandatory in some, but optional in most.
- Collision: If the covered vehicle is damaged in a collision, this is the type of coverage that will pay for repairs. Should the vehicle be damaged to the extent that repairs will cost more than the depreciated value of the car, the insurance company will make a lump-sum payment. Collision is subject to a deductible, which is the amount of the loss paid by the policyholder. The coverage is not mandatory in any state, but most lenders will require borrowers to carry it.
- Comprehensive: This coverage pays for damages or losses to the covered vehicle that are not the result of a collision. Vandalism, hail damage and theft are examples of losses that would fall under comprehensive coverage. Like collision, it is typically subject to a deductible. It is also not required by law, but may be required by lenders.
- Gap Coverage: Because collision and comprehensive payments are based on the current value of the vehicle, some lenders may find that a payment for a total loss is insufficient to pay off the outstanding loan. Gap coverage pays the difference between the remaining loan amount and the depreciated value of the vehicle.
- No-Fault: In simplest terms, no-fault insurance means that when there is an accident, each driver?s insurance company covers its own policyholder?s damages. It does not matter who is at fault. In most states that require no-fault automobile insurance, the policyholders are limited in their ability to sue the other driver. No-fault is mandatory in some states and unavailable in others.
Finding the Best Prices on Car Insurance
Although it is true that all cars need the same amounts of liability coverage and need to be covered against loss in amounts that reflect the value of the car, insurance rates can vary widely. Each state has an insurance board or commissioner that regulates insurance companies, but the range in which the rates must fall is quite large.
Obtaining online quotes from a number of different companies is the easiest way to find which company offers the best rate.
Not every company is the least expensive for all drivers, so just because the owner of an expensive sports car finds a great rate at one company, it is not always true that the owner of a family sedan will do likewise.
The driver?s history of accidents and tickets is an important part in determining insurance rates. In most states, insurance companies can also take the driver?s credit history into account when deciding whether to issue a policy. The more accurate the information entered when requesting a quote, the more accurate the quote will be. Know what states have the highest auto insurance rates so that you can compare quotes among other quotes for that state.
Mandatory Minimum Coverage by State
Liability insurance is typically represented by three numbers, such as ?20/40/15,? which state the coverage amounts in thousands. The first number is the amount the policy will pay for bodily injury to one person injured in an accident for which the policyholder is at fault, and the second number is the amount for all people injured in the same accident. ?The third number is the amount of property damage protection.?Many people ask?why auto insurance minimums vary so much per state, but it is important to know the coverage levels for your state.
- Alabama: Only liability is mandatory, with minimum limits of 20/40/10.
- Alaska: Only liability is mandatory, with minimum limits of 50/100/25.
- Arizona: Only liability is mandatory, with minimum limits of 15/30/10.
- Arkansas: Only liability is mandatory, with minimum limits of 25/50/25.
- California: Only liability is mandatory, with minimum limits of 15/30/5.
- Colorado: Only liability is mandatory, with minimum limits of 25/50/15.
- Connecticut: Liability, with minimum limits of 20/40/10, and uninsured motorist mandatory.
- Delaware: Liability, with minimum limits of 15/30/10, and personal injury protection mandatory.
- District of Columbia: Liability, with minimum limits of 25/50/10, and no-fault insurance mandatory.
- Florida: Liability, with minimum limits of 10/20/10, and no-fault insurance mandatory.
- Georgia: Only liability is mandatory, with minimum limits of 25/50/25.
- Hawaii: Liability, with minimum limits of 20/40/10, and no-fault insurance mandatory.
- Idaho: Only liability is mandatory, with minimum limits of 25/50/15.
- Illinois: Only liability is mandatory, with minimum limits of 20/40/15.
- Indiana: Only liability is mandatory, with minimum limits of 25/50/10.
- Iowa: Only liability is mandatory, with minimum limits of 20/40/15.
- Kansas: Liability, with minimum limits of 25/50/10, and no-fault insurance mandatory.
- Kentucky: Liability, with minimum limits of 25/50/10, and no-fault insurance mandatory.
- Louisiana: Only liability is mandatory, with minimum limits of 10/20/10.
- Maine: Only liability is mandatory, with minimum limits of 50/100/25.
- Maryland: Only liability is mandatory, with minimum limits of 20/40/15.
- Massachusetts: Liability, with minimum limits of 20/40/5, and no-fault insurance mandatory.
- Michigan: Liability, with minimum limits of 20/40/10, and no-fault insurance mandatory.
- Minnesota: Liability, with minimum limits of 30/60/10, and no-fault insurance mandatory.
- Mississippi: Only liability is mandatory, with minimum limits of 10/20/5.
- Missouri: Only liability is mandatory, with minimum limits of 25/50/10.
- Montana: Only liability is mandatory, with minimum limits of 25/50/10.
- Nebraska: Liability, with minimum limits of 25/50/25, and uninsured/underinsured motorist mandatory.
- Nevada: Only liability is mandatory, with minimum limits of 15/30/10.
- New Hampshire: Liability (25/50/25) and medical payment insurance required along with proof of ability to be financially responsible.
- New Jersey: Liability, with minimum limits of 15/30/5, uninsured motorist, personal injury protection and no-fault are all mandatory.
- New Mexico: Only liability is mandatory, with minimum limits of 25/50/10.
- New York: Liability, with minimum limits of 25/50/10, uninsured motorist, personal injury protection and no-fault are all mandatory.
- North Carolina: Only liability is mandatory, with minimum limits of 30/60/25.
- North Dakota: Liability, with minimum limits of 25/50/25, uninsured/underinsured motorist, personal injury protection and no-fault are all mandatory.
- Ohio: Only liability is mandatory, with minimum limits of 12.5/25/7.5.
- Oklahoma: Only liability is mandatory, with minimum limits of 25/50/25.
- Oregon: Only liability is mandatory, with minimum limits of 25/50/10.
- Pennsylvania: Liability, with minimum limits of 15/30/5, medical payment coverage and no-fault all mandatory.
- Rhode Island: Only liability is mandatory, with minimum limits of 25/50/25.
- South Carolina: Liability, with minimum limits of 15/30/10, and uninsured motorist mandatory.
- South Dakota: Liability, with minimum limits of 25/50/25, and uninsured motorist mandatory.
- Tennessee: Liability with limits of 25/50/10 or equivalent proof of financial responsibility.
- Texas: Only liability is mandatory, with minimum limits of 30/60/30.
- Utah: Liability with limits of 25/50/15, personal injury protection and uninsured/underinsured motorist and no-fault mandatory.
- Vermont: Liability with minimum limits of 25/50/10 and uninsured motorist mandatory.
- Virginia: Liability with minimum limits of 25/50/20 and uninsured/underinsured motorist mandatory.
- Washington: Only liability is mandatory, with minimum limits of 25/50/10.
- West Virginia: Liability with minimum limits of 20/40/10 and uninsured motorist.
- Wisconsin: Liability with minimum limits of 25/50/10 and uninsured motorist.
- Wyoming: Only liability is mandatory, with minimum limits of 25/50/20.

With the minimum levels of coverage presented here, you can know the requirements for auto insurance in your state. This will also make it easier to comparison shop for car insurance online. Be sure to compare quotes and know what you are looking for in order to get the best auto insurance rates. Enter your ZIP code into our FREE auto insurance comparison tool to start comparing quotes right away!
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