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Nearly all states have minimum car insurance requirements, but car insurance experts recommend going beyond state minimum liability requirements. 

Buying a new car is a thrill. But if you fail to insure your new wheels properly, you might be in for heartbreak down the road. 

Not only is it smart to get car insurance, but just about everywhere, purchasing such coverage is necessary if you plan to obey the law. Nearly every state requires you to buy a minimum amount of car insurance. 

Purchasing the state minimum car insurance will keep you out of hot water with the law, but this level of coverage isn’t often robust enough to fully protect yourself from the financial damage that might occur if you are in an accident. 

Read on to learn more about the minimum level of car insurance you need to drive legally in your state – and why you might need more coverage. 

Key Takeaways

  • Most states require you to purchase car insurance, although New Hampshire and Virginia are exceptions.
  • States have their own rules for the minimum coverage that you must purchase.
  • Some states require drivers purchase forms of car insurance coverage that are optional in other states.
  • Typically, buying the minimum amount of insurance – and nothing more – isn’t adequate to protect your finances.

What is state minimum car insurance?

The minimum amount of car insurance is the level of coverage your state requires you to purchase if you plan to drive legally.

Do you need car insurance? Yes. Nearly every state requires you to buy at least some liability insurance. This is the type of insurance that reimburses you when you damage a car, another person’s property or a person’s health. 

“Insurance is regulated at the state level, and legal requirements vary from state to state,” says Scott Holeman, media relations director at the Insurance Information Institute.

Some states also require you to buy minimum levels of other coverages, such as: 

State auto insurance rules differ depending on where you live, so make sure you know which laws apply to you.

How does minimum insurance work?  

This is another form of policy that protects you only against bodily damage to other cars, not injuries to other drivers. The goal of minimum insurance coverage is to ensure that you fulfill the state legal requirement to drive a car on public roads and pay for damage caused by your actions in a collision. The minimum insurance does not cover medical expenses or car repairs, and in certain situations, it does not cover additional costs that exceed the amount allocated for the maintenance of your car.  

What is the purpose of minimum insurance coverage?

States impose minimum insurance requirements to make sure drivers have enough insurance to pay claims when accidents occur. 

If these requirements were not in place, millions of accidents likely wouldn’t be reimbursed, causing financial hardship for those involved. 

How much auto insurance do I need?

The minimum insurance requires is just that — a minimum amount. But usually, purchasing the minimum required amount of car insurance is a mistake. That coverage doesn’t often offer enough coverage to protect your finances. 

“Most insurance experts would recommend that auto insurance consumers purchase more coverage than the minimum requirements,” Holeman says. 

In a worst-case scenario, you could be sued for hundreds of thousands of dollars – or more – if you seriously injure someone in a car accident. 

“If a driver is at fault in an accident, the liability could far exceed the minimum required coverage,” Holeman says.

So, it’s important to purchase enough insurance to protect your assets. 

What is the minimum amount of liability coverage required for car insurance? 

The minimum liability coverage required for drivers is 25/50/25, which costs $25,000 per person, $50,000 in personal injury liability, and $25,000 in property damage liability.  

  • 25 – The first number in the liability coverage depicts the highest amount your insurance policy will pay for bodily injury claims for a single person. In this case, 25 represents $25,000 in coverage
  • 50 – The maximum amount your insurance company will pay for bodily injury claims in a whole accident is the second number in your liability coverage. This does not overlap the per-person limit of your liability coverage. In this case, 50 represents $50,000 in coverage
  • 25 – The maximum amount your insurance coverage will pay for property damage claims in the event of an at-fault accident is determined by the third number, which is typically 100. In this case, 25 represents $25,000 in coverage

How to read auto insurance liability limits 

Auto insurance liability coverage has two parts. The first is bodily injury and the second is property damage. 

Bodily injury pays for the medical expenses of those you harmed in an auto accident, up to your limits. Property damage covers the damage you caused to another vehicle or other property, such as a fence, in an auto accident. 

Payment is up to your limits. Liability coverage does not cover your injuries or damages to your vehicle. Instead, it only covers damages to someone else’s vehicle, property or well-being. 

Here’s how to read auto insurance liability minimum limits:

  1. First number: Bodily injury liability maximum for one person injured in an accident.
  2. Second number: Bodily injury liability maximum for all injuries in one accident.
  3. Third number: Property damage liability maximum for one accident.

For example, if you live in New York, the minimum liability limits are $25,000 for injury liability for one person, $50,000 for all injuries and $10,000 for property damage in an accident (written as 25/50/10). 

Keep in mind that state requirements are the lowest limits you can carry and may not be adequate. A car accident can cost far more than the limits mandated by most states as medical expenses have skyrocketed and the value of vehicles has gone up.

You want to make sure you have enough car insurance coverage to protect you if you get in an accident. That includes protection to cover other driver and passenger injuries and against potential lawsuits. 

Experts recommend at least:

  • $100,000 in bodily injury protection per person per accident
  • $300,000 in bodily injury protection per accident
  • $100,000 in property damage per accident

That’s often referred to as 100/300/100 coverage. 

Higher liability limits offer better protection and don’t cost that much more. So, if you can afford it, raise your limits to protect your assets, such as home and motor vehicles. 

Car insurance coverage abbreviations 

Here’s your guide to the car insurance acronyms in the chart below that lists the minimum car insurance coverages in each state. New Hampshire doesn’t mandate car insurance in its laws but instead requires you to provide financial responsibility if you cause an accident. The easiest way to provide this is with a car insurance policy.

Many states just require liability coverages, so you have a way to cover damages you cause to others. But some states require a variety of other coverages.  Here is your cheat sheet for the abbreviations used in our chart for various coverages.

  • UM: Uninsured motorist coverage
  • UIM: Underinsured motorist coverage
  • UMBI: Uninsured motorist bodily injury coverage
  • UMPD: Uninsured motorist property damage coverage
  • BI liability: Bodily injury liability
  • PIP: Personal injury protection
  • PPI: Property protection insurance (Michigan)

What are the minimum state standards for insurance?  

The minimum state standards for insurance are as follows:  

  • Bodily injury liability (BI): Helps cover the medical expenses related to the other driver’s injuries. It also covers the legal fees, in case of the other driver suing you for their losses. 
  • Property Damage liability: Pays for the property damage caused to the others. For example, if you hit a car in an accident the property damage coverage will pay for the vehicle repairs of the other driver.  
  • Uninsured/Underinsured motorist coverage: This type of coverage provides financial protection, if the at-fault driver is uninsured or does not have enough coverage to pay for your losses 
  • Personal injury protection (PIP): A requirement in states with no-fault laws. It will cover the medical expenses, wage loss or repair costs irrespective of who caused the accident 
  • Medical payments coverage: Considered optional coverage in most states. It can be used in non-PIP states. It mostly covers medical expenses after an accident but is considered less effective than PIP.

Minimum car insurance requirements by state 

Minimum car insurance requirements vary by state. Here’s a look at each state’s requirements.

State Minimum car insurance limits
AlabamaLiability: 25/50/25
AlaskaLiability: 50/100/25
ArizonaLiability: 25/50/15
ArkansasLiability: 25/50/25
CaliforniaLiability: 15/30/5
ColoradoLiability: 25/50/15
ConnecticutLiability: 25/50/25
 UM/UIM BI: 25/50
DelawareLiability: 25/50/10
 PIP: 15/30
District of ColumbiaLiability: 25/50/10
 UM BI: 25/50
 UMPD: $5,000
FloridaLiability: 10/20/10
 PIP: $10,000
 BI liability not required by Florida but many carriers require 10/20
GeorgiaLiability: 25/50/25
HawaiiLiability: 20/40/10
 PIP or PPO: $10,000
IdahoLiability: 25/50/15
IllinoisLiability: 25/50/20
 UM BI: 25/50
IndianaLiability: 25/50/25
IowaLiability: 20/40/15
KansasLiability: 25/50/25
 UM/UIM BI: 25/50
 PIP: $4,500/person for 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
KentuckyLiability: 25/50/25
 PIP: $10,000
LouisianaLiability: 15/30/25
MaineLiability: 50/100/25
 UM/UIM BI: 50/100
 Medical payments: $2,000
MarylandLiability: 30/60/15
 UM/UIM BI: 30/60
 UMPD: $15,000
 PIP $2,500
MassachusettsLiability: 20/40/5
 UM/UIM BI: 20/40
 PIP: $8,000
MichiganLiability: 50/100/10
 PIP: 6 choices from $50,000 to unlimited medical
 PPI: $1,000,000
MinnesotaLiability: 30/60/10
 UM/UIM BI: 25/50
 PIP: $40,000
MississippiLiability: 25/50/25
MissouriLiability: 25/50/10
 UM BI: 25/50
MontanaLiability: 25/50/20
NebraskaLiability: 25/50/25
 UM/UIM BI: 25/50
NevadaLiability: 25/50/20
New Hampshire*Liability: 25/50/25
 UM/UIM BI: 25/50
 Medical payments: $1,000
 *Insurance not mandatory in New Hampshire
New JerseyLiability: 15/30/5 (standard policy)
 UM/UIM BI: 15/30
 UMPD: $5,000
 PIP: $15,000
New MexicoLiability: 25/50/10
New YorkLiability: 25/50/10
 UM BI: 25/50
 PIP: $50,000
North CarolinaLiability: 30/60/25
 UM BI: 30/60
 UMPD: $25,000
North DakotaLiability: 25/50/25
 UM/UIM BI: 25/50
 PIP: $30,000
OhioLiability: 25/50/25
OklahomaLiability: 25/50/25
OregonLiability: 25/50/20
 UM BI: 25/50
 PIP: $15,000
PennsylvaniaLiability: 15/30/5
 First party benefits (PIP): $5,000
Rhode IslandLiability: 25/50/25
South CarolinaLiability: 25/50/25
 UM BI: 25/50
 UMPD: $25,000
South DakotaLiability: 25/50/25
 UM/UIM BI: 25/50
TennesseeLiability: 25/50/15
TexasLiability: 30/60/25
UtahLiability: 25/65/15
 PIP: $3,000
VermontLiability: 25/50/10
 UM/UIM BI: 50/100
 UMPD: $10,000
VirginiaLiability: 30/60/20
 UM/UIM BI: 25/50
 UMPD: $20,000
WashingtonLiability: 25/50/10
West VirginiaLiability: 25/50/25
 UM BI: 25/50
 UMPD: $25,000
WisconsinLiability: 25/50/10
 UM BI: 25/50
WyomingLiability: 25/50/20

Source: Property Casualty Insurers Association of America and Insurance Information Institute; state departments of insurance and motor vehicles.

  • New Hampshire doesn’t require car insurance, but you must be able to show proof of financial responsibility if you’re in an accident.

Average car insurance rates for state minimum liability limits

The average national rate is $511, but the average annual rate varies state by state. See the average annual rate based on each state’s minimum requirements.The states are listed from cheapest to most expensive. Use the search box to find a specific state.

StateState Minimum Premium
Washington D.C.$577
North Carolina$396
North Dakota$340
New Hampshire$411
New Jersey$989
New Mexico$376
New York$875
Rhode Island$648
South Carolina$628
South Dakota$267
West Virginia$474

Average car insurance rates for state minimum liability limits by company

Car insurance companies don’t have standard rates for state minimum liability limits. 

Here are the average rates by insurance company for state minimum liability limits by company. 

CompanyLiability Only — State Minimum
American National Finance$187
Iowa Farm Bureau$305
Berkshire Hathaway$326
Southern Farm Bureau$333
Erie Insurance$334
North Carolina Farm Bureau$353
Auto Owners$355
Western National Mutual$355
Chubb Ltd$372
Island Ins Co$415
Kentucky Farm Bureau$432
State Farm$432
American Mercury Ins Co$446
Arbella Insurance$483
New Jersey Manufacturers$494
Oklahoma Farm Bureau$509
Auto Club$517
Automobile Club Mi$533
American Family Ins$563
Kemper Corp$694
Mercury Casualty$719
National Gen$786
The Hanover Ins$1,601


Insure.com commissioned Quadrant Information Services to field rates for car insurance minimums in 2022 by state and company for 40-year-old male drivers with a Good insurance score and no driving violations.

Frequently Asked Questions

What is the minimum amount of car insurance required by law?

The minimum amount of car insurance required by law varies widely by state. Each state sets its own liability minimums, but many states also require other types of coverage. 

Which states don’t require car insurance?

Nearly every state requires you to purchase liability auto insurance coverage. New Hampshire doesn’t, and in Virginia, you can pay a fee of $500 at the time of vehicle registration that will allow you to skip car insurance. 

The rules for other types of auto insurance coverage – such as uninsured and underinsured motorist coverage and personal injury protection coverage — vary by state.

What happens if you don’t have insurance on a car?

In most states, driving your car without car insurance is against the law and you will suffer significant consequences for this violation. These might include fines or the loss of your driver’s license or car registration. In some states, you might even face jail time. 

Penalties vary by state. Some states just fine drivers if they don’t have insurance. Others suspend registration and license. A couple of states even send drivers to jail for driving without car insurance.

Which state has the highest car insurance?

Motor vehicle insurance costs vary depending on where you live. Louisiana has the most expensive car insurance in the nation, according to a recent survey by Insure.com. The average annual car insurance rate in The Bayou State is $2,839, which is 99% higher than the national average. 

For many years, Michigan had the most expensive car insurance. But Louisiana took the dubious honor in 2021. 

Is car insurance required in all states? 

In most states, car insurance is required. A minimum level of automobile insurance is referred to as a required basic. In case of an accident or injury to another person or property, drivers are obligated by law to have and maintain a specific amount of car insurance from an insurance firm. You might be in violation of the regulation if you do not keep the minimum required coverage.  

Although there are 2 states which do not require car insurance, they are – New Hampshire and Virginia. Residents of Virginia can skip having car insurance if they can pay the state $500 per year. While those staying in New Hampshire are still responsible for damage occurring due to a car accident.  

What is covered by a basic auto insurance policy?

A basic auto insurance policy typically offers six types of protection, according to the Insurance Information Institute. You’re not required to carry all of these coverages in every state, but it’s often a good idea to purchase several or all of the following:

  • Bodily injury liability cover injuries that you cause to someone else.
  • Property damage liability covers damages you cause to someone else’s property.
  • Medical payments pay for medical expenses you and passengers incur after an accident.
  • Collision coverage pays for damage that occurs to your car as the result of a collision with another vehicle or object. It also covers damages related to potholes and flipping the car over.
  • Comprehensive coverage handles your losses that result from theft of your car or damages resulting from an event, such as fire, flood, windstorm or vandalism.
  • Uninsured and underinsured motorist protection covers you if an uninsured or underinsured driver hits you. 

Is 50/100 insurance enough?

50/100 insurance would mean that you have $50,000 in bodily injury coverage per person. With a maximum of $100,000 accidents. Whether or not that’s enough insurance depends on your situation. 

A higher liability limit protects your personal assets if you’re found at fault in an accident. Opting for more liability insurance will protect your assets. So, the more insurance you can afford, the better off you will be in the event of an accident. But don’t purchase more liability coverage than you can comfortably fit into your budget. Use the free Insure auto insurance comparison tool to find the best coverage for your needs and budget.

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Sarah Sharkey
Contributing Researcher


Sarah Sharkey is a personal finance writer with a master’s degree in management from the Hough School of Business at the University of Florida. She enjoys helping readers find money solutions that work. She has written for numerous personal-finance publications including Money Under 30 and The College Investor.

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