Auto Insurance Requirements by State in 2025

Auto insurance requirements by state vary, but almost all states require drivers to carry at least liability insurance. Some states may also require other types of auto insurance coverage, like personal injury protection or uninsured motorist coverage.

Generally, minimum auto insurance rates will be higher in states where more coverage is required. Read on to learn about the car insurance requirements by state, as well as the average cost of auto insurance coverage in each state.

Looking to find affordable auto insurance coverage today? Compare rates with our free quote tool to find coverage in your state.

Meeting Your State Auto Insurance Requirements

Every state sets its own requirements for liability limits and auto insurance coverages, and most states require auto insurance on vehicles in order to drive them. Liability limits refer to the amounts of liability coverage that are required for bodily injury and property damage, and are displayed in three sets of numbers.

For example, the liability numbers 25/50/25 mean that a driver must carry $25,000 of bodily injury coverage to pay for injuries per person, and $50,000 of bodily injury coverage to cover all injured parties in an accident. The last number is for property damage coverage, which means that a driver must carry $25,000 of property damage coverage.

Other coverages that may be required in states besides liability insurance include personal injury protection (PIP), MedPay, and uninsured or underinsured motorist coverage (UM/UIM).

If your state requires you to carry some of these other coverages, you can expect that your average state rates will be a bit higher.

For example, Wyoming only requires 25/50/25 of liability insurance, and the average cost of minimum liability insurance in Wyoming is only $24 per month. Texas, on the other hand, requires 30/60/25 of liability insurance as well as personal injury protection, and has an average rate of $77 per month for minimum coverage.

States with the Highest Requirements for Auto Insurance

Does your state have comparatively strict or lenient requirements for auto insurance coverage? All of the states with the highest requirements, except for Wisconsin, require drivers to carry uninsured and underinsured motorist coverage. These coverages will help pay if you’re hit by a driver without insurance or by a driver who has minimal insurance.

Michigan ranks number one in having the highest requirements for auto insurance coverage, and it also has a higher average cost of auto insurance. This is because Michigan requires 50/100/10 of liability insurance, $50k  of personal injury protection, uninsured motorist coverage, and underinsured motorist coverage.

It is important to meet Michigan’s requirements of uninsured and underinsured motorist coverage, as 19.6% of Michigan’s drivers are uninsured, putting you at risk.

States with the Lowest Requirements for Auto Insurance

In other states, the requirements for auto insurance are a lot less stringent, with lower liability limits and fewer coverages required. In some states, such as New Hampshire, auto insurance may not be required to drive. However, drivers must prove financial responsibility in order to opt out of coverage.

Virginia also doesn’t require insurance if drivers can prove financial responsibility, but there is a $500 fee to opt out of coverage (Learn More: Best Auto Insurance Companies in Virginia).

Each of these states’ lower liability limits is the minimum required for drivers. This means that drivers can opt to carry more than the minimum coverage of liability insurance if they wish to.

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Top Factors Affecting Minimum Auto Insurance Costs

The minimum car insurance required in your state is just one factor that affects how much you’ll pay for coverage. Another major factor that affects rates is your driving record. No matter what state you live in, a poor driving record will result in higher rates because insurance companies view you as more likely to file a future claim.

However, having a DUI in one state may cost less than having a DUI in another state. For example, the average for a DUI auto insurance in Michigan is $277 per month, but in South Dakota, DUI insurance only averages $34 per month (Read More: Cheap Auto Insurance for High-Risk Drivers).

Another factor that may have some influence on your rates is your gender. When you look at average rates by gender in states, you will see that females tend to pay slightly more than males in some states.

In other states, there is no cost difference in the average rates for male and female drivers. However, the U.S. averages show that females pay an average of $744 per year for auto insurance, while males pay an average of $732 per month. Note that this doesn’t apply to all states, as some have banned the use of gender in determining auto insurance rates.

Claims Impact State Minimum Auto Insurance Requirements

Minimum car insurance requirements are higher in states with high accident rates, traffic fatalities, or a high volume of claims. For example, California has 3.5 million accidents a year, with the average claim cost set at $1,026,000.

Another risky state is Florida, with 2.5 million accidents a year and an average claim cost of $1,024,000. In riskier states like this, it is wise to protect yourself financially in an accident with adequate, full coverage auto insurance.

Read More: Worst States for Filing Auto Insurance Claims

Required Auto Insurance to Protect Against Claims

One of the main reasons it is so important to meet your state’s auto insurance requirements is to protect yourself financially. If you don’t have liability insurance, you could be sued by the people you injure or be required to pay the entire bill out of pocket.

For example, liability insurance claims for bodily injury to others average $20,000 per claim and account for 12% of claims. However, collision claims are the most common type of auto insurance claim, accounting for 30% of claims.

If you don’t have collision auto insurance, you will have to pay for your own vehicle’s repairs in the majority of accident cases. Comprehensive insurance claims are another common type of auto insurance claim, accounting for 15% of all claims and averaging $2,500 per claim.

What’s the difference between collision vs. comprehensive auto insurance? Comprehensive coverage covers most accident situations outside of collisions, as well as damages due to theft or vandalism. While not required, collision and comprehensive coverages should be carried by most drivers and are required on leased or loaned vehicles.

Wondering at what point is full coverage not worth it? If your car is older and has a low resale value, then you may not need full coverage. Essentially, if the cost of full coverage will soon equal the value of your car, it is best to carry just minimum coverage that meets the state car insurance requirements.

Saving Money on State-Required Auto Insurance

If you’re unhappy with the cost of your auto insurance after meeting the personal or commercial auto insurance requirements by state, make sure that you are taking advantage of auto insurance discounts. Discounts can be grouped into three main categories, and providers usually offer at least a few discounts in each category.

Carrying multiple policies at one insurance company is an easy way to earn a larger discount at a company, as well as making the management of different types of insurance easier. Another discount that can earn customers a significant price cut is usage-based discounts, as percentages off can be as high as 40% (Read More: 17 Car Insurance Discounts You Can’t Miss).

Company	Program	Savings	System
	Drivewise®	40%	Mobile App
	KnowYourDrive	20%	Mobile App
	TrueRide®	30%	Mobile App
	YourTurn®	30%	Mobile App
	RightTrack®	30%	Plug-in Device
	SmartRide®	40%	Mobile App or Plug-in
	Snapshot®	30%	Mobile App
	Drive Safe & Save™	30%	Mobile App or Plug-in
	TrueLane®	25%	Mobile App
	IntelliDrive®	30%	Mobile App

To earn a usage-based discount, however, you have to allow the auto insurance company to track your driving habits for a period of time, and the discount may vary based on how well you score in the program.

If you want to find the cheapest auto insurance in your state today, we recommend shopping around and comparing quotes. You can enter your ZIP in our free tool to get started.