What Is State Minimum Insurance?

Updated: January 2022

State minimum insurance is exactly what it sounds like -- the minimum purchase requirements set by each state for car insurance. Depending on which state you are a resident of, the amount of and types of insurance you’ll need to legally drive will vary.

As state minimum insurance is different in each state, we can’t give an exact definition of what it includes, but we can offer some generalities. Most states require some level of liability insurance, which essentially covers the other party in the event that you cause an accident. Certain states also require medical payments or personal injury protection coverage, which cover medical costs. Uninsured/underinsured motorist coverage is also common.

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How Do States Differ?

As each state sets their own standards for car insurance, what we’ve described above is by no means exhaustive. Requirements vary when it comes to both the types and amounts of insurance that drivers must purchase -- for example, Alabama requires drivers purchase $25,000 in personal injury liability coverage, while California only requires $15,000.

One major distinction between states is how fault is treated in an accident. While most states assign fault in accidents and require the at-fault party to pay for the damage they’ve caused, there are a number of no-fault states that require all parties to use their own insurance for any damage they’ve experienced, regardless of whose fault the accident was. As you can imagine, this difference has an effect on the state minimum requirements of no-fault states -- namely, most of them require all drivers to purchase personal injury protection in order to ensure all medical costs are covered in an accident.

Given how different each state’s standards are, it’s important that you keep up with the state minimum standards of your state in particular.

Is State Minimum Enough?

The short answer? Probably not. While purchasing the state minimum is enough to legally drive, it most likely won’t provide enough coverage in the event of an actual accident. State minimum insurance is typically bare bones as far as coverage goes. Drivers that opt for only purchasing the minimum might save some money on monthly premiums, but often end up spending more once an accident happens -- if you don’t have enough insurance to cover the costs associated with any damage that results from an accident, you’ll be expected to pay out of pocket, which gets expensive fast. For this reason, we recommend that drivers consider purchasing more than the state minimum as a safeguard against accidents.

Whether you want to stick to the state minimum or you’re looking for a more robust insurance policy, we have what you need -- drivers that use USACarInsurance.com save up to $744* per year on car insurance. Fill in your zip code and let’s drop your rate today!

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