How Much Car Insurance You Need: An Expert Guide (2023)
Insurance is required if you want to drive a car in most states, but choosing which coverage is right for you isn’t always easy. We cover how much car insurance you need and which optional coverages are best.
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Leslie Kasperowicz
Farmers CSR for 4 Years
Leslie Kasperowicz holds a BA in Social Sciences from the University of Winnipeg. She spent several years as a Farmers Insurance CSR, gaining a solid understanding of insurance products including home, life, auto, and commercial and working directly with insurance customers to understand their needs. She has since used that knowledge in her more than ten years as a writer, largely in the insuranc...
Farmers CSR for 4 Years
UPDATED: Jan 12, 2023
It’s all about you. We want to help you make the right coverage choices.
Advertiser Disclosure: We strive to help you make confident insurance decisions. Comparison shopping should be easy. We are not affiliated with any one insurance provider and cannot guarantee quotes from any single provider.
Our insurance industry partnerships don’t influence our content. Our opinions are our own. To compare quotes from many different insurance companies please enter your ZIP code on this page to use the free quote tool. The more quotes you compare, the more chances to save.
Editorial Guidelines: We are a free online resource for anyone interested in learning more about insurance. Our goal is to be an objective, third-party resource for everything insurance related. We update our site regularly, and all content is reviewed by insurance experts.
UPDATED: Jan 12, 2023
It’s all about you. We want to help you make the right coverage choices.
Advertiser Disclosure: We strive to help you make confident insurance decisions. Comparison shopping should be easy. We are not affiliated with any one insurance provider and cannot guarantee quotes from any single provider.
Our insurance industry partnerships don’t influence our content. Our opinions are our own. To compare quotes from many different insurance companies please enter your ZIP code on this page to use the free quote tool. The more quotes you compare, the more chances to save.
On This Page
- Auto insurance is required in most states, though Virginia and New Hampshire allow you to make a large deposit or pay a fee to demonstrate financial responsibility
- Getting into a serious accident could cost substantially more than the minimum required car insurance in your state
- We recommend the following minimum coverage limits: $100,000 per person, $300,000 per accident in bodily injury liability, and $100,000 per accident in property damage liability
You need to get car insurance to drive a vehicle legally in nearly every state and Washington, D.C. However, plenty of Americans buy more car insurance than they need.
According to the Federal Reserve, the average American driver pays $190 per month for auto insurance — an increase of 4% from $182 in the previous year.
Still, acquiring only the state minimums could leave you seriously unprepared to deal with an automobile accident and its consequences.
Read on to find out how much car insurance you need to protect yourself and your finances without overpaying.
How much car insurance do I need?
Liability, uninsured motorist protection, personal injury protection, comprehensive, and collision coverage are common forms of insurance that can cover anything from harming another driver in an accident to storm damage to your vehicle.
You likely need minimum liability insurance to legally drive where you live, and you’ll need to buy full coverage car insurance if you’re leasing or financing your vehicle. Other types of car insurance are optional, but we recommend researching all of your policy options to see what’s available.
Minimum Car Insurance Requirements
Every state has some kind of financial responsibility law associated with auto insurance. In most cases, the majority of drivers fulfill state car insurance laws by purchasing liability insurance. Usually, state minimums are the simplest and come with the cheapest car insurance rates.
The minimum car insurance you need to drive typically includes:
- Bodily injury liability insurance. Covers medical costs for injuries you cause to a driver and their passengers in an at-fault accident.
- Property damage liability insurance. Covers damage you cause to another’s vehicle or property in an at-fault accident.
Some states with no-fault insurance require additional coverages to pay for associated costs after an accident, including:
- Medical payments coverage (MedPay). Covers driver medical expenses after an accident, regardless of who is at fault.
- Personal injury protection (PIP). Covers the same as MedPay but will also pay for lost wages and funeral and burial costs.
Some of these types of coverage may not be available in your state, as state-by-state car insurance requirements vary by law. However, most require at least liability coverage to pay for the other driver and their passengers’ injuries and property damage.
Find your state in the table below to find out how much liability car insurance you need:
| State | Minimum Liability Car Insurance Limits |
|---|---|
| Alabama | 25/50/25 |
| Alaska | 50/100/25 |
| Arizona | 25/50/15 |
| Arkansas | 25/50/25 |
| California | 15/30/5 |
| Colorado | 25/50/15 |
| Connecticut | 25/50/25 |
| Delaware | 25/50/10 |
| District of Columbia | 25/50/10 |
| Florida | 0/0/10 |
| Georgia | 25/50/25 |
| Hawaii | 20/40/10 |
| Idaho | 25/50/15 |
| Illinois | 25/50/20 |
| Indiana | 25/50/25 |
| Iowa | 20/40/15 |
| Kansas | 25/50/25 |
| Kentucky | 25/50/25 |
| Louisiana | 15/30/25 |
| Maine | 50/100/25 |
| Maryland | 30/60/15 |
| Massachusetts | 20/40/5 |
| Michigan | 20/40/10 |
| Minnesota | 30/60/10 |
| Mississippi | 25/50/25 |
| Missouri | 25/50/25 |
| Montana | 25/50/20 |
| Nebraska | 25/50/25 |
| Nevada | 25/50/20 |
| New Hampshire | 25/50/25 |
| New Jersey | 15/30/5 |
| New Mexico | 25/50/10 |
| New York | 25/50/10 |
| North Carolina | 30/60/25 |
| North Dakota | 25/50/25 |
| Ohio | 25/50/25 |
| Oklahoma | 25/50/25 |
| Oregon | 25/50/20 |
| Pennsylvania | 15/30/5 |
| Rhode Island | 25/50/25 |
| South Carolina | 25/50/25 |
| South Dakota | 25/50/25 |
| Tennessee | 25/50/15 |
| Texas | 30/60/25 |
| Utah | 25/65/15 |
| Vermont | 25/50/10 |
| Virginia | 25/50/20 |
| Washington | 25/50/10 |
| West Virginia | 25/50/25 |
| Wisconsin | 25/50/10 |
| Wyoming | 25/50/20 |
Liability insurance only covers damages you cause in an accident and does not protect your vehicle. If you opt for full coverage auto insurance, as many do, you are protected in the event of most accidents, regardless of whose fault it is.
When you shop for insurance quotes online, our comparison tool will know how much car insurance you need based on your ZIP code. You can find accurate car insurance quotes from local companies for the amount of coverage you need.
Optional Types of Car Insurance
Minimum coverage is not enough for most drivers. Because of that, many opt to purchase additional coverage.
Below are some of the most common and beneficial add-on coverages available from most car insurance companies:
- Collision car insurance. Collision coverage pays for damages you sustain in an accident or collision, regardless of who is at fault.
- Comprehensive car insurance. Comprehensive coverage pays for any damage not caused by a collision, including weather, fire, vandalism, and animal damage.
- Guaranteed asset protection (Gap) insurance. Loan/lease gap coverage will cover any remaining amount on your car loan or lease if your car is stolen or totaled in a covered event.
- Uninsured/underinsured motorist coverage (UM/UIM). UM/UIM coverage pays for damages if you’re involved in an accident with an uninsured, underinsured, or hit-and-run driver.
- Roadside assistance. This add-on coverage pays for towing and locksmith services, gas delivery, tire changes, and more if you’re stranded with your vehicle.
Even if it isn’t required in your state, you should still consider buying these types of coverage. For example, UM/UIM coverage is an extremely helpful and reasonably-priced addition to your auto insurance policy, especially if you live in a state with high rates of uninsured drivers.
We also recommend carrying collision and comprehensive coverage. When you buy these coverages along with your minimum insurance requirements, it’s known as full coverage. You may be required to carry full coverage if you have an auto lease or loan because it insures your vehicle across multiple risks.
However, adding optional coverages will raise your monthly car insurance rates. Liability insurance is the cheapest type of car insurance you can have, but it offers the least protection.
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State Minimum Insurance: Is it enough?
You’ve undoubtedly seen the slash line from your insurance provider on your policy documents at some point. For example, the state minimum car insurance requirements are often written as 25/50/15 or $25,000/$50,000/$15,000. But what do those numbers mean?
They’re levels of liability coverage that depend on the circumstance and nature of the accident, which we get into in more detail below:
- $25,000 refers to the bodily injury liability limits per person
- $50,000 refers to the total bodily injury liability limit per accident
- $15,000 refers to the property damage liability limit
This kind of insurance pays for injuries and property damage you cause in an at-fault accident. It’s required in nearly every state to protect injured accident victims. Read our guide on the best bodily injury liability car insurance companies to find coverage at the lowest rates.
However, it’s difficult to imagine a world where $50,000 would cover medical costs in the event of a serious multi-car accident. Because of that risk, we recommend increasing your liability insurance coverage limits to match your personal net worth.
To protect yourself financially after a major accident, we recommend the following coverage limits for minimum car insurance policies:
- $100,000 per person
- $300,000 per accident in bodily injury liability
- $100,000 per accident in property damage liability
You’ll be better prepared with appropriate coverage limits by purchasing additional insurance. This is because the potential for something devastating, like selling your house or declaring bankruptcy to meet your financial obligations, will be reduced.
Additionally, drivers should consider getting, if not full coverage insurance, at least collision coverage. This insures your vehicle against damages no matter who causes the accident or if you collide with an animal or stationary object.
What states don’t require car insurance?
Only two states — Virginia and New Hampshire — do not mandate car insurance. Although New Hampshire residents are not required to have auto insurance, they are still liable for up to $50,000 in liability costs and $25,000 in property damage costs after a car accident.
Virginians who pay a state fee of $600 per year can legally forgo purchasing auto insurance. However, the fee does not include any accident coverage, and the at-fault driver is still responsible for the accident. Drivers who are unable to pay for damages should prepare for the suspension of their licenses and registrations in these states.
How much does car insurance cost?
The average cost of a full coverage car insurance policy is based on numerous factors, including driver age, driver gender (where permissible by law), accident claims history (known as a CLUE report), and make/model of the vehicle you want to insure.
For a 30-year-old driver with a clean record in the U.S., the average cost of full coverage insurance is around $134 per month. Liability insurance costs around $52.
The table below shows the average monthly car insurance rates by age, gender, and marital status.
| Driver Type | Average Geico Rates | Average American Family Rates | Average Farmers Rates | Average Allstate Rates | Average Liberty Mutual Rates |
|---|---|---|---|---|---|
| Single 17-Year-Old Female | $471.13 | $499.71 | $710.16 | $773.52 | $968.42 |
| Single 17-Year-Old Male | $523.25 | $677.54 | $762 | $886.88 | $1143.22 |
| Single 25-Year-Old Female | $198.24 | $190.72 | $245.57 | $285.41 | $329.97 |
| Single 25-Year-Old Male | $188.57 | $224.56 | $253.45 | 4297.58 | $375.26 |
| Married 35-Year-Old Female | $191.91 | $183.56 | $213.08 | $263.01 | $316.9 |
| Married 35-Year-Old Male | $192.7 | $185.36 | $213.15 | $260.25 | $321.4 |
| Married 60-Year-Old Female | $186.72 | $166.08 | $194.73 | $242.78 | $287.08 |
| Married 60-Year-Old Male | $190.29 | $167.87 | $204.03 | $249.22 | $306.71 |
Full coverage insurance costs nearly double that of minimum liability, but you’ll be better protected behind the wheel. Further, adding optional coverages like gap insurance or roadside assistance will lead to higher quotes.
To avoid paying too much for car insurance, ask your company if you qualify for car insurance discounts that can bring down the overall cost of your policy.
Which deductible is best for car insurance?
If you buy collision or comprehensive car insurance, you will have what is called a “car insurance deductible.” The deductible is the amount you pay upfront before your auto policy applies.
Deductibles range in price from $250 to $1,000, though lower deductibles usually mean higher car insurance rates.
It’s a good idea to keep your car’s current market value in mind when choosing a deductible for your physical damage insurance policy. For example, if you drive an older vehicle worth around $3,000, setting a deductible amount of $1,000 might mean paying more out-of-pocket to restore the vehicle after an accident.
Conclusion: How Much Car Insurance Drivers Need
Most state insurance laws require a minimum level of liability insurance, although you may be required to carry higher limits if you lease or finance your vehicle. Your lender may also require comprehensive and collision insurance, known together as full coverage car insurance.
The minimum coverage requirements for auto insurance in your state are just that — minimal.
We recommend that drivers always carry more insurance than required by law to avoid making up the difference out of pocket if they’re found at fault for an accident.
We recommend shopping around for quotes from at least three different companies to find the best price on car insurance. Use our comparison tool below to find the best insurance companies with the cheapest rates and most up-to-date car insurance quotes.
Frequently Asked Questions
Is car insurance required?
In 48 of the 50 states, drivers must have liability insurance. The legal requirements for liability insurance vary from state to state, with some requiring uninsured motorist coverage or personal injury protection and others requiring only liability insurance for physical harm and property damage. Check with your insurance agent about the requirements in your state.
Only New Hampshire and Virginia don’t require drivers to carry insurance. Still, drivers must demonstrate that they can satisfy the state’s basic standards for financial responsibility, usually by paying a nominal annual fee to the state DMV.
Why do you need car insurance?
Car insurance requirements are meant to shield individuals from financial losses due to another driver’s carelessness. In addition, requiring minimum liability insurance means you are much less likely to end up with huge repairs and medical bills after an accident you didn’t cause.
What happens if you don’t buy auto insurance?
Driving without the bare minimum of auto insurance is dangerous. It could even have potentially life-changing effects. If you are stopped without insurance, you risk paying fines, having your license and registration suspended, and paying expensive premium surcharges.
If you have inadequate or no insurance and are in an accident, you may have to spend thousands of dollars out of your own pocket to cover the costs of the injuries and property damage. Additionally, your assets and salary may be taken if you cannot make payments.
How long is auto insurance required?
You should have auto insurance for as long as you own and drive a vehicle. If you don’t own a car but drive regularly, you can buy non-owner car insurance coverage to meet the minimum insurance requirements in your state.
If you own an older vehicle, you can typically safely forgo comprehensive and collision coverage and only keep liability if the value of your car is less than the cost to repair it.
Are you looking for free insurance quotes?
Your one-stop online insurance guide. Get free quotes now!
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Leslie Kasperowicz
Farmers CSR for 4 Years
Leslie Kasperowicz holds a BA in Social Sciences from the University of Winnipeg. She spent several years as a Farmers Insurance CSR, gaining a solid understanding of insurance products including home, life, auto, and commercial and working directly with insurance customers to understand their needs. She has since used that knowledge in her more than ten years as a writer, largely in the insuranc...
Farmers CSR for 4 Years
Editorial Guidelines: We are a free online resource for anyone interested in learning more about insurance. Our goal is to be an objective, third-party resource for everything insurance related. We update our site regularly, and all content is reviewed by insurance experts.