Car Insurance Requirements by State: What You Must Know (2025 Update)

Updated: June 2025

📍 Why Every State Has Different Car Insurance Laws
The United States does not have car insurance laws enforced at the national level — they depend on the state you are in. Each state has the authority to determine the minimum levels of coverage a driver should carry in order to legally operate a vehicle.
Not being familiar with the requirements in your state can have consequences such as fines, a suspended license, or denied claims after an accident.
This article offers a summary of the minimum coverage needed in each state, the main types of required insurance, and some of the things drivers should be aware of before going on the road

🧾 Basic Types of Required Coverage (Most States)
1. Liability Insurance
It pays the medical costs and the repair bills of the other motorist if you are at fault in an accident. Most of the states demand the following:

• Bodily Injury Liability (BIL)
• Property Damage Liability (PDL)

For instance, 25/50/25 indicates that the sum would be $25,000 per person, $50,000 per accident (injuries), and $25,000 for property damage.

2. Personal Injury Protection (PIP)
It kicks in in no-fault states and caters to your medical costs regardless of whether you are the guilty one or not.

3. Uninsured/Underinsured Motorist (UM/UIM)
Once you have it, this coverage envelopes the possible repercussions if a motorist who crashes into you is uninsured or his/her insurance does not provide sufficient cover. Required in certain states. Otherwise, it is up to your sole decision whether to get it or not.

🗺️ State-by-State Minimum Coverage (2025)

⚠️ This table lists minimum required liability coverage. Additional coverage like collision, comprehensive, and roadside assistance is optional.

✅ Note: “25/50/25” = $25,000 BIL per person / $50,000 per accident / $25,000 PDL

🔍 What Happens If You Don’t Meet Minimum Coverage?
Driving without car insurance may have such consequences as:

• Fines ranging from $500 to $1,500
• Revoke of driving license or car registration
• Impounded car
• Loss of claims in case of an accident

In a few states, unlawful acts over and over again may even mean spending time in jail.

🧠 Extra Coverage to Consider (Even If Not Required)
Even though it is compulsory for the states to have at least liability insurance, the majority of drivers include the following optional coverages into their policies:

• Collision coverage: You’ll get compensation for the repairs of your car if you are found completely at fault.
• Comprehensive: This one protects from a variety of issues such as theft, weather, fire, and even a smash, etc.
• Gap insurance: The balance of the loan is paid in the event of the total loss of the new car.
• Rental reimbursement: If your vehicle is in the shop for repairs, the insurance company helps with the necessary rental cost.

💡 Most lenders will only agree on full coverage of the car as a security if you have taken the car on loan or lease.

❓FAQs – Car Insurance Laws by State
Q: Can I drive in another state with my current insurance?
Yes, your policy automatically gives you coverage in other states as per the minimum requirements in those states.
Q: Are insurance requirements the same for leased or financed cars?
The full coverage required by the lenders’ grants include not only the state minimum but also
collision and comprehensive coverage.
Q: What’s the difference between no-fault and at-fault states?
In no-fault states (like FL or MI), each driver’s insurance pays for their own injuries. In the latter case, the
driver who is found at fault pays.