State Auto Insurance Minimums, Laws and Requirements


Liability
Each state requires a different legal minimum of auto insurance and in many states you cannot even register your car until you prove you have liability insurance. States that don't require auto insurance upfront work on a type of honor system wherein you must prove you have coverage only after you receive a ticket or are involved in an accident.

Of the fifty states, five do not require motorists to carry liability coverage and the others that do require it, have a state minimum that you must purchase. Once you commit to buying it, you must purchase at least as much as your state requires.

Personal Injury Protection and No-Fault
Personal Injury Protection (PIP) is an add-on to your auto insurance coverage. PIP covers medical expenses and sometimes extends to lost wages and other types of damages. PIP is often referred to as No-Fault coverage because its requirement is due to no-fault laws, which require the insurance company to pay without accounting for fault. No-fault also extends to protect the claimant and the insured from premium increases stemming from a PIP claim.

In several No-Fault states wherein carrying PIP coverage is not required, the insurance company is still required to pay PIP claims and thereafter seek recompense from the liable party's insurance carrier. This frees the insured from costly medical bills and the insurance companies are left to duke it out on their own.

Uninsured Motorist Coverage
Uninsured motorist coverage is coverage in which the policy owner pays a special premium and thereafter the insurance company pays an injured driver's medical bills minus what the uninsured driver can afford to pay. Only a few states require this type of coverage.