Getting your liability limits right is one of the most important decisions you make as a driver and it's a question I get asked frequently. Too little leaves you personally responsible after a serious at-fault accident. Too much means paying for more protection than your assets require. Use the tool below to get a personalized recommendation for how much car insurance you need:
How Much Car Insurance Do I Need in 2026?
Updated: May 28, 2026
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Determine How Much Car Insurance Do You Need
Answer 6 quick questions and get a personalized coverage recommendation — including your state's minimum requirements and expert-recommended limits.
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What Are Liability Limits and How Much Do You Need?
To drive your car legally, you need at least the minimum amount of liability car insurance required in your state, but the right should cover your assets including savings, investments, and home equity.
- Under $50,000 in assets: We recommend 50/100/50 if you can afford it.
- $50,000 to $500,000 in assets: Get at least 100/300/100. Those at the higher end should consider 250/500/250.
- $500,000 to $5,000,000 in assets: You need 250/500/250 or higher. Umbrella coverage is strongly recommended at this level to give you another $1M or more of coverage.
- $5,000,000 or more in assets: Work with an insurance broker on a customized umbrella and liability limits of 250/500/250 or more.
Liability insurance pays for damage you cause in a crash. Bodily injury liability covers medical expenses for people you injure. Property damage liability covers repairs or replacement for the vehicle or property you hit. It does not pay for damage to your own car. Limits are written as three numbers. A 100/300/100 policy means $100,000 per person for bodily injury, $300,000 per accident for bodily injury and $100,000 for property damage.
Do You Need Full Coverage?
Full coverage adds collision and comprehensive coverage to your policy. Collision covers accidents with other vehicles or objects. Comprehensive covers theft, weather, vandalism and animal damage. Full coverage adds $50 to $250 monthly depending on your location, car model and driving record. In our analysis, 79% of drivers who shop at MoneyGeek choose full coverage.
Get full coverage if:
- Your car is financed or leased. Your lender requires it. See below for requirements.
- You can't afford to repair or replace your car out of pocket if it was in an at-fault accident
- Your car is newer or has high repair costs. Newer vehicles lose value quickly in the first few years and repair costs are higher, making full coverage worth having.
- You live in an area with high theft rates, severe weather or flood risk
Consider dropping full coverage if:
- Your annual comprehensive and collision premium plus your deductible is close to your car's current value, full coverage is not worth buying. On a $4,000 car with $2,000 in comp and collision premiums, you spend half the car's value every year without filing a claim. Add a $1,000 deductible on top and dropping coverage makes more financial sense. Check your car's value at each renewal using Kelley Blue Book. Learn more about when to drop full coverage.
Deductibles: Pick a deductible you can afford to pay out of pocket. A $500 deductible lowers your out-of-pocket costs if you file a claim but raises your monthly premium. A $1,000 deductible does the opposite. If you have a clean record and rarely file claims, the premium savings from a $1,000 deductible pay for themselves within two to three years.
How Much Car Insurance You Need for Financed & Leased Cars
If you are financing or leasing your car, your lender sets the minimum coverage required. Most lenders require 100/300/100 liability limits, full coverage and a $500 deductible, but check your agreement.
If your assets exceed those limits required by your lender, you could still be personally responsible for the difference in an accident. Use your asset profile above to set the right limits for your situation, not just your lender's minimum.
Gap insurance pays the difference between what you owe on your loan and what your car is worth if it is totaled. New cars lose value fast. In the first two to three years of a loan, you can easily owe more than the car is worth. If you total it during that window, your regular insurance only pays the car's current market value, leaving you on the hook for the rest. Buying gap coverage through your insurer costs far less than buying it from the dealer.
Other Car Insurance Coverage You May Need
Here are other car insurance coverages you need depending on your state or should consider based on your driver profile:
Uninsured Motorist Coverage
This pays your bills if an uninsured or underinsured driver hits you. According to the Insurance Research Council, about 15% of drivers are uninsured, and one in three drivers is either uninsured or underinsured. Without this coverage, your only option is to sue the other driver. If they have no money, you collect nothing. Match your UM limits to your liability limits.
Required in: 22 states.
We recommend it for: All drivers who can afford it, even where it's not required.
Personal Injury Protection (PIP)
PIP pays your medical bills and lost wages after an accident, no matter who caused it. Unlike liability insurance, it covers your costs, not the other driver's.
Required in: 12 states: Delaware, Florida, Hawaii, Kansas, Kentucky, Massachusetts, Michigan, New Jersey, New York, North Dakota, Oregon and Utah.
We recommend it for: Drivers with no health insurance or a high-deductible plan. If your state doesn't require it, compare it with MedPay before adding it. PIP costs more but covers more.
MedPay
MedPay pays your medical bills and your passengers' bills after an accident, regardless of fault. If your state requires PIP, you don't need MedPay. It does the same thing. Don't pick a $1,000 or $2,000 limit. One ER visit can cost more than that. Get at least $5,000.
Required in: Maine, New Hampshire and Pennsylvania.
We recommend it for: Drivers with a high-deductible health plan or no health insurance, in states where PIP is not required.
Umbrella Policy
An umbrella policy adds liability coverage above your auto and home limits. It kicks in when a lawsuit exceeds what your regular policy pays. According to the Insurance Information Institute, it costs $200 to $350 per year for $1 million in coverage, depending on your location.
Required by: No states.
We recommend it for: Anyone with assets over $500,000, a home, or a teen driver.
Summary & Next Steps
The table below summarizes recommendations for how much car insurance you need across coverage types:
Liability limits | 50/100/50 or state minimum if higher | 100/300/100 | 250/500/250 |
Full coverage (Collision & Comprehensive) | Yes with $1,000 deductible if car worth $5,000+. Required if financed or leased. | Yes, $1,000 deductible | Yes, $500 deductible |
Uninsured motorist | Match liability limits or state minimum | 100/300 | 250/500 |
Personal injury protection | 50/100/50 or state minimum if higher | $25,000 or state minimum if you have good health insurance | $50,000+ or state minimum with good health insurance |
Umbrella policy | No | No | Yes |
Est. monthly cost | $25–$125 | $100–$250 | $150–$250+ |
Next Steps:
- After you determine how much car insurance you need, get quotes from at least 3 insurance companies. See which companies will be cheaepst for you based on your profile and which insurers get the best reviews.
- Be sure to compare equal coveage amounts when getting car insurance quotes so you are comparing apples-to-apples.
FAQ
What insurance coverage should I get for a new or expensive car?
The liability limits you need should be based on your asset you have to protect ranging from 50/100/50 to 250/500/250. We recommend full coverage (comprehensive and collision) with $1000 deductible, and gap insurance if financing. Add new car replacement coverage if your car is less than two years old (adds 5 to 10 percent to your premium but covers steep depreciation).
Is car insurance per person or by car?
Car insurance follows the car, not the driver. It covers anyone with permission to drive. Regular household drivers should be added as named drivers to avoid coverage gaps.
How many cars can you have on your insurance policy?
Most insurers allow four to five cars on a multi car policy at the same address. Multi car policies save 10 to 25 percent compared to separate policies.
Can I change how much car insurance I have mid-policy?
Yes. You can change your deductible, add or remove coverage types, and adjust your liability limits at any time during your policy period. Changes usually take effect immediately or within a few days.
What insurance do I need if I drive for Uber/Lyft?
Your personal auto policy does not cover you while the app is on. Add rideshare coverage to your personal policy. Some insurers will drop you if you drive for hire without telling them.
MoneyGeek's coverage recommendations are based on analysis of thousands of car insurance purchases across all driver profiles. Cost information is derived from over 52 million quotes across varying coverage levels, giving us a broad view of what drivers actually pay at each tier of protection. Mark Fitzpatrick, a licensed insurance producer, and Mark Friedlander, an insurance industry expert, bring direct experience working with thousands of customers to help people make a balanced cost versus protection decision.
See our full methodology.
About Mark Fitzpatrick
Mark Fitzpatrick, a Licensed Property and Casualty (P&C) Insurance Producer in Connecticut, is MoneyGeek's resident insurance expert. He has spent nearly a decade analyzing the market, first at LendingTree and now at MoneyGeek, where he has produced original research on hundreds of carriers and millions of rates across auto, home, renters, health and life insurance.
He covers economics and insurance at MoneyGeek, and his work has been featured in The Washington Post, The New York Times and NPR, among other outlets.
Like all MoneyGeek analysts, he draws on independent cost and consumer experience data, and no insurance company partnership influences his recommendations.
Fitzpatrick earned his degrees from Johns Hopkins University (M.A. Economics and International Relations) and Boston College (B.A.). He began his career in financial risk management at State Street. He's also a five-time “Jeopardy!” champion.