States Where Car Insurance Is Not Mandatory (2022)

October 17, 2022

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There are only two states where auto insurance is not required: virginia and new hampshire. This is because each state sets its own limits and requirements for the car insurance minimums a driver must carry when covered. Although Virginia and New Hampshire don’t require auto insurance, most drivers buy a policy anyway to protect themselves financially.

Reading: What state is car insurance not required

In this guide, we’ll explore Virginia and New Hampshire auto insurance laws, as well as how to choose the best option for your plan if you live in either of these states. We’ll also explore the best auto insurance providers that can meet your needs in states where auto insurance isn’t required, but is beneficial nonetheless.

Use the tool below to start getting auto insurance quotes. Because rates can vary based on your age, vehicle, driving history, and more, we always recommend getting at least three quotes. For an easier experience, you can also call our team at (844) 246-8209.

in this article:

which states do not require car insurance?
car insurance requirements in virginia and new hampshire
how to show proof of financial responsibility
pros and cons of not having insurance
states that allow bonuses in lieu of auto insurance
minimum requirements in other states
is it against the law don’t have car insurance?
our recommended car insurance companies

Which states do not require auto insurance?

There are only two states where auto insurance is not required for all drivers: Virginia and New Hampshire. In Virginia, an uninsured motor vehicle fee can be paid to the state, while in New Hampshire, vehicle owners have the option of depositing bonds in cash. all other states have some type of car insurance requirements, usually liability or personal injury protection, depending on the related laws in the state.

virginia and new hampshire auto insurance requirements

In both states where car insurance is not required, you must get approval to waive the requirements or pay a fee. virginia and new hampshire are both at-fault states, which means the person causing the accident must show financial responsibility up to a certain amount for the costs of the other driver’s injuries and property damage.

car insurance laws in virginia

Virginians have three options: purchase traditional auto insurance, prove financial responsibility for an accident, or pay a $500 Uninsured Motor Vehicle (UMF) fee to the Virginia DMV at check-in. This rate does not act like auto insurance, it simply waives your requirements to purchase the minimum requirements from a provider. drivers and owners must also renew the fee each time they renew their registration.

If you choose to purchase auto insurance in Virginia, you must follow these minimums:

$25,000 bodily injury liability insurance (bi) per person
$50,000 bodily injury liability insurance per accident
$20,000 liability insurance to property (pd)

Drivers who choose to pay the $500 UMF remain financially responsible if they cause an accident. Therefore, they can also request a self-insurance certificate from the DMV or deposit funds from an executed bond. this option is ideal for someone with a lot of cash who would prefer to forego the auto insurance process.

car insurance laws in new hampshire

Although the New Hampshire DMV strongly recommends purchasing auto insurance, you may be approved to waive insurance. however, there are some groups of drivers that are commonly denied this exemption. For example, you may be denied if you have a history of duis, have caused accidents without car insurance in the last three years, or have certain traffic-related convictions.

new hampshire is one of the states where auto insurance is not required, despite these exceptions. even those who have been denied can contact the financial responsibility office to appeal their case after a certain period of time.

if you buy auto insurance in new hampshire, you must follow these minimums:

$25,000 bi per person
$50,000 bi per accident
$25,000 pd
$1,000 medpay
uninsured motorist coverage equal to liability coverage

how to show proof of financial responsibility

In states where auto insurance is not required, drivers must demonstrate financial responsibility.

virginia financial responsibility

The $500 fee is the cheapest way to get out of financial responsibility, but it’s not the smartest way if you cause an accident. Drivers can waive insurance and waive the fee by proving financial responsibility in one of three ways:

Executed bond
Cash or security deposit
Self-insured, which usually requires owning a large number of vehicles

new hampshire financial liability

new hampshire is a bit strange in that you don’t need to technically prove liability to get insurance exemption. however, you are required to prove financial responsibility after an accident that you cause. in this case, you would be responsible for the minimum insurance requirements in the state. You can do this with the use of a bond or by depositing cash with the state. If you cannot meet these requirements, your license and registration may be suspended.

pros and cons of not having auto insurance

Although states where auto insurance is not mandatory may seem like they save drivers money, an accident can offset the cost of monthly premiums.

How much do you have to earn to not have car insurance? Although there is no specific salary threshold, giving up car insurance generally only makes sense for someone with deep savings. You must be able to show that you can cover the costs of medical payments and property damage for both yourself and the other party in certain situations.

states that allow bonuses in lieu of car insurance

Although the other 48 states require auto insurance, there are a few places that allow you to purchase bonds instead.

How do bonuses work in this scenario? At a very basic level, a bail bond combines the concepts of insurance and bank loans. Let’s say you want to buy a $50,000 bond. Depending on your credit score, you’ll be required to pay a down payment on top of $50,000, usually between one and fifteen percent as a premium. if you suddenly need the full $50,000, such as in the case of causing an accident, the bond provider pays the $50,000 and you are obligated to pay the provider back.

The following states allow individuals to deposit funds or issue bonds in lieu of auto insurance:

*drivers must still have liability insurance and uninsured motorist insurance, unless waived.

minimum requirements in other states

You’ll likely see similar car liability insurance breakdowns like the ones we listed for states where car insurance isn’t required. all other states require liability minimums. this covers costs when you are at fault for an accident.

other states may also require:

personal injury protection (pip): covers the costs of your own medical bills and lost wages if you live in a no-fault state
medpay : covers medical costs beyond what your health insurance covers
uninsured/underinsured driver (um/uim): covers you when you have a accident with another driver who does not have liability insurance or does not have enough insurance

Requirements vary depending on whether the state is in a traditional failed or non-failed state. no-fault states require each party to seek medical coverage from their own auto insurance companies.

so which state has the lowest auto insurance? In 2016, the Insurance Information Institute (III) found Idaho to be the least expensive state with an average annual spend of $599.77 for drivers.

Use the tool below or call (844) 246-8209 to collect and compare auto insurance quotes from providers available in your state:

Is it against the law not to have car insurance?

No matter where you live, you must follow the procedures to purchase, or in states where car insurance is not required, waive your responsibility for car insurance. Failing to do so has serious consequences. Unfortunately, many states still have large populations without car insurance, despite the laws.

What are the penalties for not following auto insurance laws? As with the requirements, these vary by state. common penalties include:

suspension of your license or registration
fines
vehicle impounded
points on your license
time on jail
court fees and reinstatement fees

Underinsured or uninsured motorist coverage may be a good bet if you live in a state with a large population of uninsured drivers. As we mentioned earlier, this will keep you safe if you live in an at-fault state and are in a car accident with someone who didn’t purchase the correct amount of coverage.

our recommended car insurance companies

Even if you live in one of the states where car insurance is not required, or if you choose to go the car insurance bonus route, car insurance plans may be the best way to stay financially stable. long-term.

In our recent study of more than 30 companies across the country, several vendors stood out above the rest. We recommend getting auto insurance quotes from a few providers to ensure you get the best rates.

#1 geico: best overall

While Geico auto insurance is known for its catchy ads, it’s also the best option for its extensive coverage and great prices. As one of the nation’s largest agencies, customers have access to mobile features and a variety of auto insurance discounts.

once you’ve met your state’s minimum car insurance requirements, take a look at additional types of coverage from geico, including roadside assistance, car rental reimbursement, and mechanical breakdown insurance.

state farm #2: best for students

If you have a student driver in your home, state farm auto insurance might be a good option for you. The insurance company offers deep discounts for student drivers and good driving behavior. it’s also highly respected and industry-rated by top reviewers.

Along with the six standard types of auto insurance, state farm offers roadside assistance, car rental and travel expense coverage, and rideshare insurance.

Use the tool below or call (844) 246-8209 to compare quotes from geico, state farm, and other insurance providers:

methodology

In an effort to provide accurate and unbiased information to consumers, our expert review team compiles data from dozens of auto insurance providers to formulate rankings of the best insurers. companies receive a score in each of the following categories, as well as an overall weighted score of 5.0 stars.

Industry Reputation: Insurers with strong financial ratings and customer-centric business practices receive the highest scores in this category.
Availability: We consider availability by state, as well as exclusions for specific groups of drivers.
Coverage: This rating is based on the types of insurance available, the maximum coverage limits and policy add-ons.
cost and discounts: our research team reviews sample quotes for a variety of drivers in each state. Companies with the lowest prices and many discount opportunities on auto insurance receive the highest scores.
Customer Service: We analyzed customer reviews and feedback studies from expert consumers like j.d. power.
technology: Auto insurers with mobile apps, advanced online services, and telematics are more likely to meet consumer needs.

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