Your Guide to Car Insurance Requirements State-by-State

By the Mercury Team

One size doesn’t fit all when it comes to auto insurance. Every state has its own rules and regulations, which is why you need to understand the specific requirements of where you live or where you plan to move. Whether you’re sticking with your current insurance or shopping around for a new policy, knowing what your state requires will give you peace of mind whenever you hit the road.

Is Auto Insurance Required in All States?

Almost every state in the U.S. requires drivers to have some form of car insurance. The only state that doesn’t require car insurance is New Hampshire. Instead, drivers must prove they have enough funds to cover any costs if they cause an accident. If you’re found at fault and can’t meet these financial obligations, you could lose your driving privileges in the state.

Virginia was another state that allowed drivers to opt out of traditional insurance by paying a $500 uninsured motorist fee. However, the state recently updated its laws to require drivers to carry a minimum amount of liability insurance.

So, while there are a few unique cases, having auto insurance is the norm nationwide.

Key Car Insurance Laws by State

When it comes to auto insurance, each state has its own set of rules that drivers need to follow. Let’s explore some of the most important aspects of these car insurance laws.

Minimum Auto Insurance Coverage Requirements

Every state requiring car insurance has its minimum coverage levels, which can vary widely. Typically, these requirements include liability coverage, which covers damages or injuries you may cause to others in an accident. Some states also require uninsured/underinsured motorist coverage, which protects you if the other driver doesn’t have adequate insurance.

For example, in California, the minimum liability coverage is 15/30/5, meaning $15,000 for injury or death per person, $30,000 for injury or death per accident, and $5,000 for property damage. In contrast, Texas requires 30/60/25 coverage, which offers more protection with higher limits.

State-Specific Regulations

Beyond minimum coverage, some states have additional regulations that can affect your insurance needs. For example, Florida is a no-fault insurance state, meaning that your insurance covers your own injuries and damages regardless of who’s at fault in an accident. This is different from most states, where the at-fault driver’s insurance typically covers the damages.

Other states have unique requirements, like New York, which mandates personal injury protection (PIP) as part of its no-fault insurance system. PIP covers medical expenses and lost wages for you and your passengers, regardless of fault.

Penalties for Non-Compliance

Failing to meet your state’s insurance requirements can lead to serious consequences. Common penalties include fines, suspension of your driver’s license, and even the impoundment of your vehicle. In some states, if you’re caught driving without insurance, you might also face higher insurance premiums in the future, making it more costly to get coverage later on.

For instance, driving without the required insurance in Texas can result in fines starting at $175 for a first offense, with fines increasing for subsequent offenses. In more severe cases, your license could be suspended, making it illegal to drive until you provide proof of insurance.

How to Stay Compliant with Car Insurance Laws

Here are a few tips to help you stay compliant and avoid penalties:

• Regularly check state regulations: Laws can change, so it’s a good idea to periodically review your state’s insurance requirements. This is especially important if you move to a new state, as the requirements will likely differ.
• Contact your insurance provider: Your insurance provider can be a valuable resource for understanding your state’s specific requirements. They can help ensure your policy meets or exceeds the minimum coverage levels.
• Review your policy annually: Insurance needs can change over time, so review your policy each year. Make sure your coverage still meets your state’s requirements and provides enough protection for your current situation.

Conclusion

Understanding your state’s requirements is key to protecting you and driving legally. From knowing the minimum coverage levels to staying updated on unique state regulations, a little knowledge goes a long way in keeping you and your wallet safe.

If you’re looking for cheap auto insurance that doesn’t compromise on quality, Mercury is here to help. With a variety of auto insurance discounts available, we can help you find the right coverage at an affordable price across 11 states, including Arizona, California, Florida, Georgia, Illinois, Nevada, New Jersey, New York, Oklahoma, Texas, and Virginia.