How to Get the Cheapest State Minimum Car Insurance

by Quiana Darden Updated October 6th, 2021

Family riding together in a car that has a cheap liability insurance policy

 

You need insurance to drive legally, but you just can’t afford to pay a big premium each month.

State minimum car insurance may be the answer. But you might be wondering: What’s included in state minimum insurance? Is it really enough to cover me? How do I know if I’m getting a good deal?

Compare.com has the answers.

In This Article:

What is State Minimum Car Insurance?

State minimum car insurance is the least amount of insurance you can carry and still drive legally in your state.

Virtually every state requires liability coverage as part of their state minimum coverage requirements. This typically means you need a certain amount of bodily injury liability and a certain amount of property damage liability.

The minimum insurance laws vary a lot depending on where you live. Some states only require basic liability coverage. For example, California’s minimum insurance requirements are pretty low: $15,000 in bodily injury liability per person, $30,000 in bodily injury per accident, and $5,000 in property damage liability. This is abbreviated as 15/30/5 insurance.  

Some states require a lot more insurance, such as uninsured & underinsured motorist coverage, plus medical payments or personal injury protection (PIP). For example, New York state minimum insurance includes all this:

  • $25,000 bodily injury liability per person and $50,000 bodily injury liability per accident
  • $50,000 liability for death per person and $100,000 liability for death per accident
  • $10,000 property damage liability per accident
  • $25,000 uninsured motorist bodily injury coverage per person and $50,000 uninsured motorist bodily injury coverage per accident
  • $50,000 personal injury protection

Do you live in a no-fault insurance state, like New York? That changes the state-minimum requirements quite a bit. In the 18 no-fault states, your own insurance covers medical expenses and loss of income for you and your passengers following an accident, no matter who was at fault. In these states, medical payments or personal injury protection is required.

Wondering what your state requires? You can check with your local Department of Insurance, or check our updated state minimum car insurance page.

No matter where you live, state minimum coverage does not include comprehensive or collision coverage. This means you won’t have any protection if your vehicle gets damaged by an at-fault collision, a single-car accident, bad weather, or other circumstances when another driver’s not at fault.

What is Liability Coverage?

Your liability car insurance covers other people’s medical expenses and property damage, up to your policy limits, when you’re at fault in an accident.

There are minimum limits for liability insurance coverage, with the amount varying by state. In some states, the minimum insurance required is liability-only car insurance: a type of coverage that pays for the damage you cause to others and their property.

A liability-only car insurance policy is cheaper than full coverage, which covers damage to your vehicle in various situations. But it’s not always the right choice. If you damage your car in an accident when you’re at fault, your liability-only insurance won’t pay a dime toward repairing or replacing your vehicle.

What is Uninsured Motorist Coverage?

Nationwide, about one in eight drivers are uninsured. And in some states — like Mississippi and Michigan — more than 20% of drivers don’t have insurance. If one of these drivers injures you or damages your vehicle in an accident, you may not be able to recover any financial compensation from them.

Uninsured motorist coverage can cover your losses, up to the policy limits, in an accident involving an uninsured driver. It also can protect you in accidents caused by a hit-and-run driver, when you’re unable to get the identity and insurance information of the person who hit you. Twenty states, plus Washington D.C., include uninsured or underinsured motorist coverage in their state minimum car insurance requirements.

What is Underinsured Motorist Coverage?

Underinsured motorist coverage can help if you’re in an accident caused by someone who doesn’t have enough insurance to cover your damages. It’s typically bundled with uninsured motorist coverage in state minimum policies.

Let’s say another driver T-bones you and totals your new truck. They have 15/30/5 California state minimum insurance, which only includes $5,000 in property damage. That’s nowhere near enough to replace your $30,000 truck. Your underinsured motorist coverage can fill in the gap and cover your losses.

What is MedPay?

MedPay is short for medical payments coverage. It pays medical expenses for you and your passengers if you’re injured in an accident, no matter who was at fault. MedPay isn’t available in every state, though it’s mandatory in some state minimum insurance policies.

You might be wondering: “Do I need MedPay if I have health insurance?” Good question! MedPay can cover expenses you’d normally pay out of pocket, like co-pays or insurance deductibles.

Another good thing about MedPay is that it “follows the person.” That means it can cover you in situations when you’re not driving, or not even in a car. If you’re injured by another driver when you’re walking or cycling, MedPay can cover your medical expenses (up to the policy limit).

What is Personal Injury Protection?

Much like MedPay, personal injury protection (or PIP) can cover medical expenses for you and your passengers following an accident, no matter who was at fault. PIP also can cover other expenses resulting from an accident, such as lost income, rehabilitation costs, childcare or housekeeping services, and funeral costs.

What Isn’t Covered by Liability Insurance?

While liability insurance is an essential part of a state minimum policy, it doesn’t cover everything.

  • Your liability insurance does not cover damage to your car or property when you’re at fault in an accident. It only covers damage to other people’s vehicles or property.
  • Your liability insurance does not cover your medical expenses if you are injured in an accident. If you’re at fault in the accident, your own health insurance will cover those expenses. If someone else is at fault, their liability insurance should cover your medical bills. And if you live in a no-fault insurance state, your PIP/MedPay should pay your medical expenses.
  • To protect yourself in the event of an accident, you will need collision coverage to pay for vehicle damage and PIP/MedPay (if available in your state) to cover your medical expenses.

Does My Health Insurance Cover My Medical Expenses if I Only Have Liability Coverage?

Yes, your health insurance should cover your medical expenses following an accident — but this can get complicated. If another driver was at fault (and you live in an at-fault state), their liability insurance should pay your medical bills up to the policy limits. Your health insurer may pay first, then seek reimbursement from the other driver’s insurance company.

If you were at fault in the accident, and you carry liability insurance, then your health insurance only can help pay for your medical expenses.

Which Companies Have Cheap Liability Car Insurance?

If you’re on a tight budget, buying cheap state minimum insurance is what you need to drive legally without overpaying for car insurance. The amount you’ll pay depends on many factors: your driving record, your age, your state of residence, etc. That being said, there are some companies that are known for offering affordable liability insurance:

Insurance Company Average Annual Premium Average Monthly Premium
Aspire $522 $43.50
Commonwealth Casualty $632 $52.67
Shelter Mutual $636 $53.00
MetroMile $722 $60.17
Sun Coast $745 $62.08
Gainsco $803 $66.92
Clearcover $805 $67.08
MotionAuto $812 $67.67
FirstChicago $822 $68.50
Dairyland $840 $70.00

What are the State Minimum Car Insurance Requirements by State?

Every state has its own minimum car insurance requirements. Here you can find a list of the minimum levels of coverage you’ll need in each state. No need to memorize your state’s numbers — when you compare quotes, we’ll only show you policies that match your state’s requirements.

When Should I Choose Cheap State Minimum Car Insurance Over Full Coverage Car Insurance?

Woman thinking about her state minimum insurance opitons

For many drivers, full coverage car insurance is the best choice. You get the peace of mind from knowing you and your vehicle are protected in case of a collision or other mishap.

However, it can be a sound financial decision to drop collision and comprehensive coverage as your car gets older. The most money you’ll get from a collision/comprehensive claim is your vehicle’s actual cash value, or ACV — the insurance company’s assessment of its worth, minus your deductible.

If your car is a total loss, that means the cost to repair your car is more than its actual cash value, and your insurance company will write you a check for the car’s ACV. When your car is new, it has a high ACV, so insurance companies will spend more money to repair it before declaring it to be totaled. Over time, that payout decreases, even though your

monthly premiums generally won’t drop very much. At a certain point, it’s not worth carrying comprehensive or collision coverage at all. 

Here’s a good guideline: Consider dropping comprehensive and collision coverage when the combined annual premium amount for that coverage plus your deductible is equal to or greater than your car’s ACV.

Wondering if a cheap state minimum/liability-only policy is right for you? Consider switching if:

  • You could afford to replace your car if it were stolen today.
  • In general, you have a high tolerance for financial risk.
  • You don’t drive your car very often, or could use alternate transportation like a bicycle or bus to get around.
  • You’re not especially at risk of your car getting damaged in an accident (e.g. you don’t often drive at night, and you’re older than 21).
  • Your car has a low risk of being stolen (e.g., you park your car indoors in a garage at night).

Full Coverage vs. Liability Car Insurance Costs

Liability insurance is cheaper than full coverage, because it only covers damage and injuries incurred by other people. Full coverage — which includes comprehensive and collision — pays for repairs if your car is damaged by an accident that you cause or by something out of your control, like vandalism or a natural disaster.

Cheapest Liability Insurance for Good Drivers

Do you have a flawless driving record, without a single speeding ticket? If so, then you may be eligible for low rates!

The cheapest liability insurance for good drivers is reserved for those with a clean record, since insurance companies consider them to be the lowest risk. Policyholders without recent violations or at-fault accidents can earn good driver discounts from almost every major auto insurance company. You may be able to earn accident forgiveness with some insurers, meaning your first at-fault accident won’t cause your rate to increase.

Cheapest Liability Insurance for Drivers with a Speeding Ticket

Maybe your driving record isn’t quite so perfect, and you have a speeding ticket on there somewhere. Don’t worry too much — just shop around to find an insurance company that will offer you cheap insurance regardless. 

Cheapest Liability Insurance for Drivers with a DUI

We won’t lie: It’s tough to find cheap liability insurance when you have a DUI or DWI. A DUI conviction can more than triple insurance premiums in some states. Drivers with a DUI might also be required to file an SR-22 or FR-44 (a special financial responsibility form), which can make coverage even more expensive.

So what can you do to get cheaper insurance when you have a DUI? If it’s an option for you, purchasing a liability-only policy can be a good choice if your DUI conviction has made full-coverage insurance too expensive. Definitely compare quotes from as many insurers as you can, as some companies specialize in affordable DUI liability insurance.

Cheapest Liability Insurance for Drivers With an At-Fault Accident

Car insurers take at-fault accidents seriously. Having one on your record can raise your premiums, because insurance companies automatically assume you’re a higher-risk driver. An at-fault accident also can cause a policyholder to lose their good driver discount.

But don’t worry — you still can find low rates! In Compare.com’s data, the cheapest liability insurance for drivers with one at-fault accident is $64 per month. Your rates may be higher, of course, but comparing quotes will let you know when you’ve found the best deal.

Cheapest Liability Insurance for Teen Drivers

Teen drivers are more expensive to insure than the average driver due to their lack of experience and higher risk of being involved in an accident. If your teen is driving an older, low-value car, then purchasing liability-only insurance is one way to make teen car insurance more affordable. It’s also usually cheaper to add a teenager to a parent’s existing policy than it is to purchase an individual policy for a teen.

Cheapest Liability Insurance for Older Drivers

Car insurance prices begin to rise for drivers aged 65 and older. However, older drivers also have multiple opportunities to save — especially if you drive an older vehicle and can switch to liability-only insurance. The cheapest liability insurance for older drivers can be found by maintaining a good driving record, taking a senior defensive driving course (which will earn you a discount from many insurers), bundling policies and opting for pay-per-mile insurance if you seldom drive.

How Do I Find Cheap State Minimum Car Insurance?

Compare Quotes.

To find your best deal, you’ll need to compare free, personalized quotes on Compare.com. Why? Because every car insurance company, large and small, calculates drivers’ risk differently. One company might charge you a lot more for having a speeding ticket, or living in a certain ZIP code, while another might place less weight on those factors. The only way to accurately pinpoint your best option is to compare quotes from multiple companies! Getting a quote is easy, and it only takes 5 minutes.

Look for Discounts.

When you’re comparing quotes, we’ll ask you questions that may automatically qualify you for certain discounts. It’s also worthwhile to ask your insurance company about specific discounts they offer that may further lower your rates, such as:

  • A driver safety discount, which rewards an accident-free record or taking defensive driving courses.
  • A driver status discount, which is issued based on personal characteristics such as age or profession.
  • A multi-policy discount, which can offer significant savings if you buy multiple products from a particular insurer. The most common discount of this type is a home and auto bundle, in which you get rewarded for having home and auto insurance with the same company.
  • A vehicle discount, which can lower your rates if your vehicle features anti-theft technology or certain safety features.

Reduce Your Risk Factors.

While there are some car insurance cost factors that you can’t control, like age and gender, there are others that you can improve over time. Driving safely and improving your credit (in states that allow insurance companies to consider credit history) can raise your insurance score.

Cash in on Major Life Changes. 

Certain life events can result in cheaper car insurance. Getting married, earning a degree, moving to a different neighborhood and buying a house all have the potential to help you save on car insurance.

Learn more: 13 Life Events That Mean It’s Time to Shop for Car Insurance

Revisit Quotes After Your Driving Record Improves. 

Shop for cheap car insurance quotes online after the three- and five-year anniversaries of any accidents, tickets or moving violations. If they’ve been dropped from your driving record, you have a good chance of getting cheaper rates.

Cheap State Minimum Car Insurance FAQs

Who has the cheapest liability-only car insurance?

There’s no single company that gives everyone the cheapest rates, unfortunately. The only way to identify the best deal is to compare quotes that are personalized for you. One interesting thing our data reveals: The insurers with the cheapest liability-only insurance often are the smaller, regional insurance companies. If you limit your search to just the big companies, you may miss out on the best rates.

What kind of car insurance is the cheapest?

Generally, liability insurance is the cheapest. That’s because it includes only basic protection and nothing extra. Still, it’s worth getting quotes for other levels of coverage, too. It may cost you just a little extra each month to get a lot more protection.

Should I get liability-only car insurance?

Everyone’s financial situation is different, so we can’t answer that question for you. Liability-only insurance may be a good choice for drivers looking to reduce their car insurance payments, as long as you understand that your own losses following an at-fault accident won’t be covered.

How do I get the best deal on car insurance?

One word: Compare! It doesn’t make sense to choose an insurance company before you check quotes from multiple companies. If you can look at three, five, or even 10 quotes for the same coverage level, then you can be confident you’re getting the best deal.

Is car insurance mandatory in all 50 states?

Good question! No, car insurance is not required in all 50 states. In New Hampshire, you don’t need insurance. In Virginia, you can pay a $500 fee for the privilege of driving without insurance. And a few other states allow you to purchase a surety bond in lieu of insurance. Just know if you skip out on car insurance, you’re still responsible for other people’s expenses resulting from an accident if you’re at fault. In the long run, it pays to have insurance.

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