Rachael Brennan has been working in the insurance industry since 2006 when she began working as a licensed insurance representative for 21st Century Insurance, during which time she earned her Property and Casualty license in all 50 states. After several years she expanded her insurance expertise, earning her license in Health and AD&D insurance as well. She has worked for small health insuran...

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Chris Harrigan has an economic degree from Limestone College and an MBA from Clemson University. He previously managed auto insurance claims for Enterprise Rent-A-Car. Currently, he is using his business and insurance expertise to provide insurance data analysis and visualizations to enhance the user experience.

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Reviewed by Chris Harrigan
Former Auto Insurance Claims Manager Chris Harrigan

UPDATED: Oct 16, 2020

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Key takeaways...

  • Driving without insurance is illegal in all 50 states
  • If you cause an accident, liability insurance will usually pay the other party’s bills
  • The minimum amount of required insurance is what a driver can purchase and still drive legally

When looking for car insurance, many drivers are interested in finding the cheapest policy possible. Driving without insurance is illegal in all 50 states, as well as in several other countries.

Each state has a set minimum amount of insurance that drivers must purchase. Drivers that are caught without the required minimum may receive a citation or face losing their license.

Save the most money possible by comparing car insurance companies for FREE! Enter your zip code above to get started!

Understanding Liability Limits

There are four main types of car insurance coverage: comprehensive, collision, uninsured driver, and liability insurance. In most states, the only type of insurance that is required by law is liability insurance.

If you cause an accident, liability insurance will usually pay the other party’s bills.

Requiring liability insurance is a state’s way of making sure that drivers will not be left with large medical or repair bills just because another driver caused an accident.

The only exception to this occurs in “no-fault” states.

If a driver lives in a state that has adopted a “no-fault” law, their liability insurance will pay their medical bills, as well as their passenger’s bills, regardless of which driver is at fault.

There are two types of liability coverage: property damage and bodily injury.

Property damage covers the costs of repairing or replacing the other driver’s property. Bodily injury protection covers a person’s medical bills if they are injured in an accident.

Liability insurance is expressed using sets of three numbers.

For instance, liability insurance may be written as 25/50/15. Each number expresses the maximum amount of coverage for a specific category.

The first set represents the maximum amount of bodily injury coverage for one person. The second set represents the maximum amount of bodily injury coverage for all individuals involved in an accident.

The third set represents the maximum amount of property damage coverage.

So if a person has 25/50/15 liability insurance, their insurance will pay a maximum of $25,000 for one person in an accident, $50,000 worth of medical bills for the entire accident, and $15,000 worth of damage.

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Minimum Required Insurance by State

As reported by the Insurance Information Institute, the states with the highest insurance minimums are:

  1. Wisconsin – 50/100/55
  2. Alaska – 50/100/25
  3. Maine – 50/100/25
  4. Wyoming – 25/100/15
  5. North Carolina – 30/60/25
  6. Texas – 30/60/25
  7. North Carolina – 30/60/25
  8. Maryland – 30/60/15
  9. Minnesota – 30/60/10
  10. Utah – 25/65/15

The 10 states with the lowest insurance minimums are:

  1. New Hampshire – No minimum
  2. Florida – 10/20/10
  3. Ohio – 12.5/25/7.5
  4. California – 15/30/5
  5. New Jersey – 15/30/5
  6. Pennsylvania – 15/30/5
  7. Arizona – 15/30/10
  8. Delaware – 15/30/10
  9. Nevada – 15/30/10
  10. Louisiana – 15/30/25

New Hampshire state law does not require drivers to purchase liability insurance as long as they can show proof of their financial responsibility.

However, since it is a “no-fault” state, drivers are only putting themselves at risk by not purchasing liability insurance.

It’s also worth mentioning that many of the states with the lowest minimums are the states with the highest rates.

These states make their state minimum insurance requirements so low to help drivers afford insurance.

So while some people assume that low minimums equal low rates, this is a common misconception.

The Minimum Amount of Car Insurance

The minimum amount of required insurance is the absolute minimum that a driver can purchase and still drive legally.

This is not the amount that a driver should purchase.

The Insurance Information Institute says that the average driver needs approximately $100,000 of bodily injury coverage and $300,000 total coverage per accident.

Most drivers should also purchase a policy that includes comprehensive and uninsured or under-insured motorist protection.

Comprehensive coverage will pay for damage that occurs outside of an accident, while uninsured motorist coverage will cover a driver’s bills if they get into an accident with an uninsured or underinsured motorist.

Depending on the value of one’s car, a driver may also need collision coverage.

If a driver still owes money on an auto loan, most lenders will require them to have collision and comprehensive coverage.

So while a driver may not be required to have this coverage by law, their lender may force them to have it.

What Happens to UnderInsured Drivers

It’s important for drivers to realize that there are serious consequences to being under-insured.

For instance, if a person lives in California, they are only required to have 15/30/5 liability coverage.

However, if they get into an accident and cause another driver $100,000 worth of medical bills, they must pay the remaining $85,000 that their insurance policy doesn’t cover.

In many cases, purchasing the minimum amount of insurance ends up being much more expensive than drivers initially assume.

Taking the time to compare the policies offered by different companies is the best way to find one that offers the coverage you need at a price you can afford.

Compare the best car insurance companies for FREE! Enter your zip code below and start saving and save money today!


  1. https://www.esurance.com/info/car/bodily-injury-and-property-damage-coverage
  2. https://www.iii.org/
  3. https://www.geico.com/information/states/wi/
  4. https://www.libertymutual.com/auto/car-insurance-coverage/north-carolina
  5. https://www.geico.com/information/states/mn/
  6. https://www.nj.gov/
  7. https://www.allstate.com/tools-and-resources/car-insurance/liability-car-insurance-cover.aspx
  8. https://www.thebalance.com/understanding-minimum-car-insurance-requirements-2645473