Only two states in the country don’t require car insurance. Here’s everything you need to know about car insurance requirements in the U.S., plus why you should consider purchasing insurance even if it’s not required.

For most drivers, backing out of the driveway without a solid car insurance policy is a big no-no.

Not only is it required by law, but it also offers a world of protection for your car, your person, and your bank account, in the event of an accident.

Car insurance is, well, kind of a big deal.

But what if I told you that there are drivers on the road right now without an auto insurance policy?

You would think that they are breaking the law.

Well, if they are from New Hampshire or Virginia, they are operating well within their rights.

Here’s everything you need to know about what New Hampshire and Virginia do require from drivers, along with why you should still consider purchasing coverage if you live in them. 

New Hampshire

These States Don't Require Car Insurance - New Hampshire

What is required?

New Hampshire does not require a minimum amount of car insurance coverage, and drivers can legally operate a registered vehicle without insurance.

That said, drivers are still responsible if they do get into an accident. They could face costs of up to $50,000 for liability and $25,000 for property damage.

Is anyone required to purchase auto insurance?

Some drivers in New Hampshire must purchase insurance coverage, including drivers with:

  • DWIs.
  • Habitual offenders.
  • At-fault convictions for an uninsured accident.

Does New Hampshire have minimum coverage requirements?

If you do decide to purchase car insurance coverage in New Hampshire, you’ll need to meet certain minimum coverage requirements. These include:

  • $25,000 for bodily injury or death of one person.
  • $50,000 for bodily injury or death of two or more people.
  • $25,000 for property damage.
  • $1,000 for medical payments coverage.
  • Uninsured motorists coverage.

Because the potential costs of an accident are so high, it usually makes sense to purchase insurance coverage rather than run the risk of getting into an accident while uninsured.

While car insurance may seem like an unnecessary monthly expense, it’s much easier to afford a robust car insurance policy than it is to cover the potential cost of even a minor accident.

Virginia

These States Don't Require Car Insurance - Virginia

What is required?

In Virginia, drivers must have insurance coverage unless they pay an uninsured motor vehicle fee of $500 annually in addition to normal registration fees.

Does the fee need to be paid upfront?

Eligible vehicle owners may pay the fee over time using a payment plan if they can’t afford the fee upfront.

Does Virginia have minimum coverage requirements?

If you don’t pay the uninsured motor vehicle fee, you are required to purchase auto insurance with minimum coverage amounts of:

  • $25,000 for bodily injury or death of one person.
  • $50,000 for bodily injury or death of two or more people.
  • $20,000 for property damage.

Because this fee is often comparable to the amount drivers would pay per year for insurance coverage, while lacking many of the benefits of car insurance, it’s almost always advisable to purchase car insurance rather than pay the fee.

Other states with less strict car insurance requirements

All 48 other states in the country require car insurance coverage of some kind. 

Minimum coverage amounts vary by state

The minimum coverage amount varies from state to state, and may not apply to all vehicles. For example, Florida does not require motorcycle insurance coverage but does require auto insurance coverage for all vehicles with four wheels.

While you must meet the minimum insurance requirements in order to legally operate your vehicle, it’s usually a good idea to purchase more than the minimum amount of required coverage. More robust insurance coverage can save you a lot of money in the event of an accident or if your car is damaged.

Proof of financial responsibility may be enough in some states

Some states, like California, for instance, allow drivers to provide proof of financial responsibility instead of purchasing car insurance.

In these cases, drivers may either purchase a bond or provide a cash sum to prove that they can cover costs in the event of an accident. Drivers still need to carry proof of financial responsibility with them when driving, just like they would have to provide proof of insurance coverage.

What happens when you get into an accident without insurance

These States Don't Require Car Insurance - What happens when you get into an accident without insurance

There are several consequences if an uninsured motorist gets into an accident in a state that doesn’t require car insurance.

  • In New Hampshire, drivers are responsible for up to $50,000 in liability costs and $25,000 in property damage costs. If drivers aren’t able to pay these bills, they may have their license suspended and will no longer be able to drive.
  • In Virginia, drivers remain personally liable for an accident even if they pay an uninsured motorist fee. This means that they will be responsible for the cost of an accident, including costs related to bodily injury, death, and property damage. They will also be responsible for their own medical bills and the cost, if any, to repair their vehicle.

Why you should purchase car insurance (even if it’s not required)

If you can afford to do so, you should purchase as much car insurance coverage as you possibly can, even if your state does not require it. After all, the more insurance you have, the better your chances are of walking away from an accident with minimal damage to your finances. 

If you (legally) drive uninsured, getting into an at-fault accident could mean that you are hit with a knock-out blow to your finances. Depending on the severity, it could be hard to keep your head above water, even if you are otherwise financially secure.

Not only that, but you could be left without transportation to and from important obligations, like your job or important medical appointments.

The peace of mind that insurance provides you is why, even though they are not usually required by most states, comprehensive and collision insurance is so popular with drivers. 

Summary

While most states require some form of car insurance coverage, not all 50 states do so. New Hampshire and Virginia are notable in that they do not require auto insurance for all motorists, but for drivers who do not have the means to dish out large amounts of money in the case of an accident, this might not be a good thing. 

While car insurance can seem like an unnecessary monthly expense, it’s almost always a smart financial move, even if you live in a state where car insurance isn’t required. 

So, before heading out on the open road, consider your car insurance policy. Are you protected?

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About the author

Total Articles: 36
Margaret Wack is a writer based in Honolulu, Hawaii. Her writing on personal finance has appeared in venues including The Simple Dollar and Interest.com. She has degrees from Smith College and St. John's College, and enjoys good tea, dead languages, and bad weather.