Minimum Coverage For Car Insurance – Driving can be extremely dangerous. Although most car trips are uneventful, the National Highway Traffic Safety Administration reports that in 2015, the most recent year for which complete data is available, nearly 6.3 million crashes were reported to police, more than 32,000 of which were fatal. These statistics show how important it is to have adequate car insurance, and given the likelihood of being involved in an accident, the more coverage you have, the better.

Car insurance can be a bit confusing, so let’s break things down. Think of it this way: say you’re driving down the road and slam into another car, causing significant damage and injuring the other driver. Liability coverage only protects the people you meet. Collision coverage is different, it would pay for the damage to your own vehicle even though you caused the crash. Comprehensive coverage provides an additional layer of protection, for example if the weather damages your car.

Minimum Coverage For Car Insurance

Minimum Coverage For Car Insurance

There are two ways to think about paying for car insurance in the US: the amount required to get the minimum level of insurance required by your state (liability coverage) and the amount to get full coverage (liability, collision and comprehensive) . Nerdwallet crunched the numbers behind our latest visualization to find out the average cost of insurance in each state, which we plotted into an intuitive visualization. It turns out that insurance prices vary dramatically by state, although there’s no obvious explanation as to why.

Who Has The Cheapest Auto Insurance Quotes In New Jersey?

First, it’s clear that minimum coverage costs less than full coverage, but there are some states where the difference is relatively small. For example, take a look at North Carolina, where full coverage goes for $1,027 but the minimum coverage is only $527, so you only save $500 for much less coverage. Compare that to Louisiana, where the difference is $1,794. It seems that insurance companies think it’s much more dangerous to drive in Louisiana than in North Carolina. And if it doesn’t cost that much more for full coverage, you might as well get it and protect yourself and your family.

There also seems to be no obvious geographical explanation for the difference in coverage costs. Michigan stands out as the most expensive state for full coverage at $3,986, not to mention the fact that the minimum coverage there is only $100 less than Louisiana’s second-cheapest price for full coverage! Perhaps Detroit’s status as a Motor City has something to do with it, but otherwise there is no clear pattern in the distribution. States in the upper Midwest, Deep South, West Coast, and East Coast are all shown at the top of the visualization.

Suppose you wanted to pay the least amount of money possible for insurance, and still meet the state minimums for coverage. Where can the lowest legal prices be found? By far the cheapest insurance is in Iowa, where it costs just $309 a year (or about $26 each month) for barebones, minimum coverage. It’s so cheap that we wonder how much protection such a policy would provide. Remember, you get what you pay for.

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Louisiana’s Minimum Coverage Law: Auto Insurance Required For Car Accident Liability

If you want to use our visualization in books, magazines, reports, educational materials, etc., we can issue a license document that gives non-exclusive rights to reproduce, store, publish and distribute.Partner Content: This content was created by a business partner of Dow Jones and researched and written independently of the editors. Links in this article may earn us a commission. Read more

The cheapest car insurance costs an average of $28 per month. USAA, Auto-Owners and Erie tend to offer the most affordable average rates

Written by: Daniel Robinson, Written by: Daniel Robinson Writer Daniel is a writer on the Guides team and has written for numerous automotive news sites and marketing companies across the US, UK and Australia, specializing in car finance and car care topics. Daniel is a Guides team authority on car insurance, loans, warranty options, car services and more.

Minimum Coverage For Car Insurance

Editor: Rashawn Mitchner, Edited by: Rashawn Mitchner Managing Editor Rashawn Mitchner is an editor for Guide’s team with over 10 years of experience in personal finance and insurance topics.

Why Is Car Insurance Mandatory? (2023)

Liability only car insurance is the cheapest insurance you can buy. But it usually only provides the minimum coverage required by state law. In this article, we at the Guides team will show you which major providers offer the cheapest car insurance on average. We’ll also examine average liability insurance costs by state and how liability coverage stacks up against comprehensive insurance.

When looking for cheap car insurance, we recommend getting quotes from the best car insurance companies in the business. It helps to compare car insurance quotes to find the best possible rates.

Cheapest Car Insurance Liability Car Insurance Liability vs Full Coverage Car Insurance How Much Car Insurance Do I Need?

The Guides Team is committed to providing reliable information to help you make the best possible decision about insuring your vehicle. Because consumers trust us to provide objective and accurate information, we created a comprehensive rating system to formulate our ranking of the best car insurance companies. We collected data on dozens of auto insurance providers to rate the companies on a wide range of ranking factors. After 800 hours of research, the final result was an overall rating for each provider, with the insurance companies that received the most points topping the list.

How Much Is Used Car Insurance & How To Get The Best Deal

If you want cheap auto insurance, you may want to consider purchasing liability-only coverage that matches your state’s minimum auto insurance requirements.

We researched the cheapest auto insurance companies and the states that tend to have the most affordable liability insurance. The estimates in the sections below are based on a married 35-year-old driver with good credit and a clean driver’s license.

Based on our research, Country Financial typically offers the cheapest liability insurance on average, at $30 per month or $356 per year. The second cheapest liability insurance coverage often comes from Auto-Owners Insurance, which charges an average of $30 per month or $358 per year.

Minimum Coverage For Car Insurance

According to our estimates, the state with the cheapest liability insurance is Iowa. The average cost of liability insurance in the Hawkeye State is typically $23 per month or $274 per year. Florida has the most expensive liability insurance, with rates tending to average $115 per month or $1,385 per year.

How Often Do Auto Accident Settlements Exceed The Policy Limits?

Car liability insurance covers the costs of property damage and personal injury to another party if you are found to be at fault in a car accident. Your insurer pays the cost of repairs to someone else’s vehicle or the cost of medical bills if the other party is injured.

Each state sets its own statutory minimum coverage, which usually includes some form of liability insurance. Virginia and New Hampshire are the only exceptions, as neither state requires motorists to have auto insurance.

Coverage amount for liability insurance is indicated with three figures. Each number represents one of the following types of liability coverage:

An example of liability insurance might be 25/50/25, which would mean you would have $25,000 in bodily injury liability coverage per person, $50,000 in bodily injury liability per accident, and $25,000 in indemnity coverage per accident.

Breaking Down The Different Types Of Car Insurance Coverage

Car insurance does not cover damage to your vehicle or costs related to your injuries. Collision insurance covers the cost of repairs to your car. Medical payment protection (MedPay) or personal injury protection (PIP insurance) covers your medical bills.

If you are found not to be at fault for the accident, you and your insurance company are not responsible for the other person’s property or damage.

If you have a car loan or lease, you will probably need comprehensive car insurance. With that in mind, you should only consider liability insurance if you own your vehicle outright.

Minimum Coverage For Car Insurance

You also need to remember that comprehensive and collision coverage are better deals when your car is new. As your vehicle ages, the maximum payout you can receive for a claim will decrease. Once your car reaches 10 to 12 years old and sees its total value drop below $10,000, it’s hard to call comprehensive auto insurance a good deal.

How Do You Get Your Medical Bills Paid After A Car Accident?

A comprehensive policy usually includes state-required liability limits as well as collision coverage and comprehensive coverage. Some comprehensive policies may also include uninsured motorist (UM) coverage because some states require it.

Liability-only insurance often has the cheapest rates in the industry – especially above full coverage. This is because liability coverage does not provide as many types of protection. Here’s a look at how average annual estimates for both types of coverage compare:

As you can see, it is not uncommon for liability insurance to cost 60% less than comprehensive insurance. Again, it’s all about getting what you pay for, as comprehensive car insurance offers far more protection than just liability coverage.

When calculating car insurance quotes, insurance companies take a look at several factors to estimate what you will pay.

Georgia’s Auto Insurance Policy Requirements


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