Which states require auto insurance?

If you live in a state where car insurance is mandatory, knowing the minimum required insurance is necessary if you want to legally operate your vehicle. Depending on your location, you must carry state auto insurance minimums of liability, personal injury protection, medical payments, and/or uninsured/underinsured motorist insurance.

In addition to the state minimum required insurance, drivers can purchase additional types of auto insurance coverage, including comprehensive, collision, and gap insurance for added protection. 

Learn more about which states require auto insurance and compare minimum auto insurance rates by state to find affordable coverage near you. 

States With Auto Insurance Requirements

There are 48 states that require auto insurance. The table below breaks down which states require auto insurance and the required limits for the 48 states where drivers must carry coverage.

Auto Insurance Minimum Requirements by State

Since each state’s minimum insurance requirements are different, drivers should check with their insurance company to confirm how much coverage they need, especially anyone who has recently moved to a new state.

Which Types of Auto Insurance You Need

The minimum liability insurance by state varies, but liability must be purchased by all drivers operating vehicles in the 48 states that carry a state minimum requirement. Some states also require personal injury protection, medical payments, and/or uninsured/underinsured motorist insurance. 

• Liability insurance: Covers expenses related to property damage and bodily injury for individuals other than the at-fault driver. 
• Uninsured/underinsured motorist coverage: Covers expenses related to bodily injury and property damage after an accident with an uninsured or underinsured driver.
• Personal injury protection insurance coverage: Also known as no-fault insurance, personal injury protection covers medical expenses for the driver and their passengers following an accident. 
• Medical payments coverage: Covers medical expenses for the driver and their passengers following an accident. 

Each of these coverages each has a limit, which means if a driver is involved in an accident, insurance will only pay up to that dollar amount. 

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States That Don’t Require Auto Insurance

New Hampshire and Virginia are the only two states that don’t require drivers to carry car insurance. However, drivers are completely free to operate their vehicles in these states because there are certain expectations. 

New Hampshire drivers have the option to purchase insurance, but if they don’t, they must prove their ability to cover property damage expenses if they cause an accident. If the driver has a major violation on their driving record, they may be required to buy auto insurance. 

Virginia drivers have their choice between paying the Uninsured Motor Vehicle fee of $500 per year or purchasing car insurance. The fee basically allows the driver to operate their vehicle in Virginia without insurance coverage. Depending on the cost, drivers could pay less than $500 for car insurance and avoid paying out-of-pocket expenses following an accident. 

Rather than purchase a car insurance policy, drivers may also have the option to self-insure, which means they put money aside in the form of a cash deposit or bond to cover the potential out-of-pocket bodily injury and property damage expenses if they cause an accident. This option may sound appealing because you aren’t paying an insurance premium, but without traditional car insurance, you’re left to cover all of the expenses on your own. 

Consequences of Driving Without Insurance

Driving without car insurance has its consequences. You don’t need to purchase full coverage auto insurance, but if it is required, you must have the state-mandated minimum amount of insurance. 

The costs of not having auto insurance exceed fines and fees. Drivers caught driving without car insurance could face vehicle impoundment, jail time, suspension, cancellation, or revocation of their license and/or license plate.

And if they are involved in an accident, they will have to cover the related expenses out of pocket. Those who don’t have the ability to pay these out-of-pocket expenses could be sued by other parties involved in the accident.

Optional Auto Insurance Coverage

In addition to the state minimum required insurance, drivers can purchase optional coverages that pay for several different expenses beyond what is covered by liability, personal injury protection, medical payments, and uninsured/underinsured motorist insurance.

• Collision auto insurance: Covers property damage resulting from a collision with a vehicle or object.  
• Comprehensive auto insurance: Covers property damage resulting from theft, vandalism, extreme weather, fire, falling objects, or a collision with an animal. 
• Rental reimbursement: Covers rental vehicle expenses while your vehicle is repaired, up to a certain amount per day. 
• Gap coverage: Covers the difference between the remaining loan or lease balance and the value of the car. It’s a good idea to look for companies that offer gap insurance when buying a new car. 
• New car replacement coverage: Covers the cost of a new vehicle of the same make and model as your totaled vehicle. 
• Roadside assistance: Companies that offer the best roadside assistance will cover things like the cost of roadside emergency services, including towing, fuel delivery, and flat tire change. 
• Rideshare: Fills in the gap between your employer-provider rideshare insurance and your personal car insurance.  

Adding any of these optional coverages to your car insurance policy allows you to avoid out-of-pocket expenses that aren’t covered by the state minimum required coverage. 

When to Consider Buying Optional Coverage

Here are a few scenarios where adding optional coverage to your car insurance policy would be a good idea:

• Full coverage is required by your lender or the dealership for your leased or financed vehicles. 
• Your vehicle’s value is less than the cost of your insurance premium and the auto insurance deductible. 
• Your vehicle’s value is too high to cover the cost of replacement or repair out of pocket if it was totaled or damaged in an accident. 
• You can’t afford the cost of a rental vehicle or emergency roadside services. 

If you’re interested in full coverage and want the best rates, shopping around can give you a better idea of what car insurance companies will charge so you can compare.  

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When State Minimum Auto Insurance Isn’t Enough

With a coverage limit attached to liability and other state-mandated insurance, drivers may be under the impression that they have enough coverage. You never know the amount of damage that can result from an accident, so the state minimum coverage amount isn’t always enough. 

Increasing your coverage limit may increase your insurance premium, but the annual cost of car insurance will likely be far less than what you would pay if you were involved in an accident and didn’t have enough coverage to pay for property damage and bodily injury for the driver you hit. 

How State Minimum Insurance Works

Say you’re involved in an accident in Colorado. Your bodily injury expenses total $20,000, and your property damage expenses total $27,000. If you opt for the minimum insurance requirement, your coverage limits will be 25/50/15, or $25,000 per person, $50,000 per accident for bodily injury, and $25,000 per accident for property damage.

Following the accident, your insurance will cover all of your bodily injury expenses because the total falls under the limit of $50,000, but you’ll pay $2,000 out of pocket for property damage since the coverage limit is $25,000. With a higher coverage limit, you have a better chance of ensuring your liability car insurance coverage fully covers property damage and bodily injury.

The Bottom Line on Which States Require Auto Insurance

If you live in a state where car insurance is required, it is important to have at least the state minimum if you avoid penalties, such as fines or license revocation.

Purchasing additional coverage isn’t necessary, but it can help drivers avoid thousands of dollars in out-of-pocket costs if they are involved in an accident. But with more coverage comes higher insurance costs, so compare rates from local insurance companies before you buy to ensure you’re getting the best auto insurance at the lowest price.

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