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What Is the Minimum Car Insurance Requirement in Iowa?

To legally drive a car, nearly every state in the US requires its motorists to carry some form of vehicle insurance coverage. How much car insurance do you need in Iowa can be one of the first questions you wonder. Iowa's car insurance laws require its drivers to have the following minimum liability insurance coverage:

  • $20,000 per person for bodily injury
  • $40,000 per accident for bodily injury
  • $15,000 per accident for property damage

Iowa's minimum car insurance limits are listed as 20/40/15. These data only represent the state's minimum coverage requirements. The amounts are the most your insurer will pay in settlement for a claim.

The limits can be increased as needed. For example, suppose the average cost of a new car damaged in an accident you caused exceeds $15,000. In that case, the minimum property damage limits will be insufficient. As a result, it is preferable to raise the liability limits as much as you can afford.

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What Does This Minimum Coverage Mean?

In Iowa, liability coverage is required by law. It covers injuries and other losses to another motorist, their passengers and their property in the event of an accident you caused. Motorists driving in Iowa must have a minimum of BI & PD (Bodily Injury and Property Damage) liability coverage with limits of 20/40/15. This implies that your insurance policy must have a least $20,000 in bodily injury coverage per person, $40,000 in total coverage for all people involved in the accident and $15,000 in property damage.

The bodily injury coverage limit per person is the most your insurance company will pay for a single person injured in a car accident caused by you. On the other hand, the bodily injury coverage per accident specifies the maximum amount of compensation your insurer will pay for all persons injured in an accident. The property damage limit represents the maximum amount payable for damage to the other person's property, such as their car, in an accident.

However, you and your vehicle won't be insured with a minimum liability coverage plan. For example, suppose you want to ensure that you and your vehicle are protected in the event of an accident. In that case, you must obtain personal injury protection (PIP) coverage to pay for any injuries sustained in the accident and collision coverage to pay for damage to your vehicle. PIP coverage protects not just you but also other passengers in your car.

How Much Does the Minimum Car Insurance Cost in Iowa?

Your auto insurance rates in Iowa can be influenced by various factors, including your age, ZIP code, driving history, credit score and the make and model of the vehicle you drive. Besides, the rates also differ amongst the state's various car insurance companies.

USAA offers the cheapest car insurance in Iowa for $226 annually. However, USAA policies are only available to current and veteran military members and their families. And that makes GEICO the cheapest widely available insurer for Iowa’s drivers. Moreover, its most affordable policy is available at just $4 more than USAA's rate at $232 annually.

These prices are only estimates based on rates for an average Iowa driver and should not be used to compare insurance prices.

For this study, MoneyGeek compared rates for Iowa's minimum liability coverage of 20/40/15 from various insurers for a 40-year-old male resident driving a 2010 Toyota Camry with a clean driving record and good credit score.

If you're instead looking for a policy that balances quality with affordability, MoneyGeek also ranked the top car insurance companies in Iowa.

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What Is the Minimum Car Insurance Requirement in Iowa While Leasing a Car?

If you operate a leased car, the leasing company's minimum coverage requirements can differ from the state's. The lessor companies expect you to return the vehicle in the same condition the company provided. You should maintain adequate insurance coverage throughout the lease agreement term. Most companies in the state demand you to have a full coverage car insurance policy with minimum liability limits of 100/300/50 before leasing a car. The requirements can be different for each leasing company.

If you have already leased a car, contact the company to know about their minimum insurance requirements. And, if you’re new to leasing, you should understand the terms of the lease agreement and Iowa's car lease insurance requirements before choosing a leased car.

Uninsured drivers account for 11.3% of Iowa's drivers. Even if the rate isn't that high, MoneyGeek suggests purchasing a full coverage auto insurance policy in Iowa, which will protect you from bodily injury and damage to your car if an uninsured motorist hits you. If you're not sure how much car insurance coverage you need in Iowa, go with our minimum liability limit recommendation of 50/100/50.

Penalties for Driving Without Car Insurance in Iowa

Iowa's law does not allow a person to operate an uninsured vehicle or drive without minimum liability insurance in their name. Driving without active car insurance in Iowa may attract fines or other penalties. If you're involved in an accident without valid car insurance, severe penalties, such as suspension of license, removal of license plates, vehicle impoundment, filing of SR-22 and community service.

Law enforcement officers in Iowa can pull you over and demand proof of financial responsibility (minimum liability coverage or more) at traffic stops or checkpoints. If you’re caught driving without insurance, you can be fined $250 and asked to provide proof of insurance in the form of an active insurance policy or SR-22 form. If you fail to submit this within 30 days, you could face one or more of the penalties mentioned earlier.

The penalties will be higher if you fail to provide proof of valid insurance after an accident. In addition, if the personal injury and property damage costs related to the accident exceed $1,500, your license and vehicle registration may be suspended. It can remain suspended for up to 12 months. Your vehicle may also get impounded and any other cars registered in your name can be suspended.

If you are convicted of any traffic infraction while driving without valid car insurance in Iowa, the following penalties apply:

  • $250 fine or community service, removal of license plates, suspension of vehicle registration and vehicle impoundment after driving without insurance.
  • For driving without insurance and being involved in an accident, a $250 mandatory fine, vehicle impoundment, suspension of license and vehicle registration (of all vehicles) up to one year if medical bills and damage costs exceed $1,500, after being involved in an accident without valid insurance.

If your driving license and privileges are suspended for driving without insurance, you can reinstate the privileges by buying a valid car insurance policy and filing an SR-22 through your insurance provider. However, you’ll have to pay $15 as an administrative fee for the reinstatement. Any towing and storage costs in case of vehicle impoundment also ensue. The motor vehicles department will then send you new license plates and a new registration receipt for your car.

If you’re involved in an accident without holding valid insurance, and you can’t provide proof of insurance, the reinstatement process can be difficult. You’ll be asked to submit proof of insurance or file SR-22 through your insurance provider within 30 days of the date of the accident. After SR-22 submission, there will be a $250 fine, $15 administrative fee, $20 license renewal fee and $200 civil penalty for reinstatement. You may also have to pass a driving exam, knowledge test and vision screening test to have your license and registration reinstated. In addition, in case of vehicle impoundment, towing and storage charges will be applicable.

The reinstatement requirements after each conviction can be as follows:

  • Driving without insurance: Proof of insurance, $15 administrative fee, towing and storage charges (if applicable), SR-22 certificate after driving without a license.
  • Accident while driving without insurance: Proof of insurance, $15 administrative fee; $200 civil penalty; $20 license renewal fee; towing and storage charges (if applicable); SR-22 certificate for two years; passing a driving exam, knowledge, vision screening test.

Frequently Asked Questions About Car Insurance in Iowa

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About Mark Fitzpatrick

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Mark Fitzpatrick is a senior content director at MoneyGeek with over five years of experience analyzing the insurance market, conducting original research and creating content that can be personalized for every buyer. He has been quoted on insurance topics in several publications, including CNBC, NBC News and Mashable.

Mark earned a master’s degree in Economics and International Relations from Johns Hopkins University and a bachelor’s degree from Boston College. He is passionate about using his economics and insurance knowledge to bring transparency around financial topics and help others feel confident in their money moves.