Updated: June 23, 2025
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Most drivers need 100/300/100 liability coverage plus comprehensive and collision insurance for complete financial protection against damage to others and your vehicle.
You must meet your state's minimum liability requirements to drive legally, but state minimums rarely provide enough financial protection for your assets.
Consider additional coverages like gap insurance, roadside assistance, personal injury protection and uninsured motorist coverage based on your needs.
Beyond meeting state laws and lender requirements, you need enough coverage to pay for injuries, property damage and potential lawsuits from an accident. The Insurance Information Institute provides these recommendations for how much car insurance is enough:Â
Most states require liability insurance, but coverage requirements vary significantly by location. Depending on where you live, you may need additional coverage like uninsured motorist protection, personal injury protection or medical payments coverage. Lenders typically require comprehensive and collision insurance for financed or leased vehicles. You should review your car insurance policy annually to ensure your coverage limits still meet your changing needs and financial situation.
Coverage | Basic Protection | Good Protection | Premium Protection |
|---|---|---|---|
50/100/50 or state minimum if very budget constrained | 100/300/100 ($100K per person/$300K per accident/$100K property damage) | 250/500/250 ($250K per person/$500K per accident/$250K property damage) | |
Recommended for cars worth over $3,000 | Recommended with $1,000 deductible | Recommended with $500 deductible | |
State minimum if required | Same as liability limits (100/300) | Same as liability limits (250/500) | |
State minimum if required | $10,000+ (Varies by state requirements) | $25,000+ | |
No (unless required for lease) | No (unless required for lease) | Recommended (only for financed/leased vehicles worth more than loan) | |
Not Required | Recommended | Recommended | |
Not Required | Recommended (unless you have second car) | Recommended, $50/day, up to 30 days | |
Not Required | Not Required or Recommend | Recommended (For vehicles under 2 years old) | |
Not Required | Not Required | Recommended |
Nearly every state in the U.S. requires minimum liability coverage. Â Thirteen states personal injury protection (PIP) to cover medical expenses. Twenty states require uninsured/underinsured motorist coverage, ensuring protection when another driver has no insurance or insufficient coverage.
State | Bodily injury liability (per person) | Bodily injury liability (per accident) | Property damage liability (per accident) | Other car insurance requirements |
|---|---|---|---|---|
Alabama | $25,000 | $50,000 | $25,000 | None |
Alaska | $50,000 | $100,000 | $25,000 | None |
Arizona | $25,000 | $50,000 | $15,000 | None |
Arkansas | $25,000 | $50,000 | $25,000 | None |
California | $30,000 | $60,000 | $15,000 | None |
Colorado | $25,000 | $50,000 | $15,000 | None |
Connecticut | $25,000 | $50,000 | $25,000 | Uninsured/underinsured motorist bodily injury: $25,000 per person $50,000 per accident |
Delaware | $25,000 | $50,000 | $10,000 | Personal injury protection: $15,000 per person $30,000 per accident |
District of Columbia | $25,000 | $50,000 | $10,000 | Uninsured/underinsured motorist bodily injury: $25,000 per person $50,000 per accident Uninsured/underinsured property damage: $5,000 (subject to $200 deductible) |
Florida | $10,000 | $20,000 | $10,000 | Personal injury protection: $10,000 |
Georgia | $25,000 | $50,000 | $25,000 | None |
Hawaii | $20,000 | $40,000 | $10,000 | Personal injury protection: $10,000 |
Idaho | $25,000 | $50,000 | $15,000 | None |
Illinois | $25,000 | $50,000 | $20,000 | Uninsured motorist bodily injury: $25,000 per person $50,000 per accident |
Indiana | $25,000 | $50,000 | $25,000 | None |
Iowa | $20,000 | $40,000 | $15,000 | None |
Kansas | $25,000 | $50,000 | $25,000 | Personal injury protection: $4,500 Uninsured/underinsured motorist bodily injury: $25,000 per person $50,000 per accident |
Kentucky | $25,000 | $50,000 | $25,000 | Personal injury protection: $10,000 |
Louisiana | $15,000 | $30,000 | $25,000 | None |
Maine | $50,000 | $100,000 | $25,000 | Medical payments: $2,000 Uninsured/underinsured motorist bodily injury: $50,000 per person $100,000 per accident |
Maryland | $30,000 | $60,000 | $15,000 | Personal injury protection: $2,500 Uninsured/underinsured motorist bodily injury: $30,000 per person $60,000 per accident Uninsured motorist property damage: $15,000 |
Massachusetts | $20,000 | $40,000 | $5,000 | Personal injury protection: $8,000 per accident Uninsured/underinsured motorist bodily injury: $20,000 per person $40,000 per accident |
Michigan | $20,000 | $40,000 | $10,000 (for damage your vehicle does to property in another state) | Personal injury protection: Unlimited per person Unlimited per accident Property protection: $1 million |
Minnesota | $30,000 | $60,000 | $10,000 | Personal injury protection: $40,000 per person Uninsured/underinsured motorist bodily injury: $25,000 per person $50,000 per accident |
Mississippi | $25,000 | $50,000 | $25,000 | None |
Missouri | $25,000 | $50,000 | $25,000 | Uninsured/underinsured motorist bodily injury: $25,000 per person $50,000 per accident |
Montana | $25,000 | $50,000 | $20,000 | None |
Nebraska | $25,000 | $50,000 | $25,000 | Uninsured/underinsured motorist bodily injury: $25,000 per person $50,000 per accident |
Nevada | $25,000 | $50,000 | $20,000 | None |
New Hampshire | $25,000 | $50,000 | $25,000 | Uninsured/underinsured motorist bodily injury: $25,000 per person $50,000 per accident |
New Jersey | $15,000 | $15,000 | $5,000 | None |
New Mexico | $25,000 | $50,000 | $10,000 | None |
New York | $25,000 | $50,000 | $10,000 | Personal injury protection: $50,000 per person Liability for death: $50,000 per person Uninsured/underinsured motorist bodily injury: $25,000 per person $50,000 per accident |
North Carolina | $30,000 | $60,000 | $25,000 | Uninsured/underinsured motorist bodily injury: $30,000 per person $60,000 per accident Uninsured/underinsured motorist property damage: $25,000 |
North Dakota | $25,000 | $50,000 | $25,000 | Personal injury protection: $30,000 per person Uninsured/underinsured motorist bodily injury: $25,000 per person $50,000 per accident |
Ohio | $25,000 | $50,000 | $25,000 | None |
Oklahoma | $25,000 | $50,000 | $25,000 | None |
Oregon | $25,000 | $50,000 | $20,000 | Uninsured/underinsured motorist bodily injury: $25,000 per person $50,000 per accident |
Pennsylvania | $15,000 | $30,000 | $5,000 | Medical payments coverage: $5,000 |
Rhode Island | $25,000 | $50,000 | $25,000 *or $75,000 combined single limit | None |
South Carolina | $25,000 | $50,000 | $25,000 | Uninsured/underinsured motorist bodily injury: $25,000 per person $50,000 per accident |
South Dakota | $25,000 | $50,000 | $25,000 | Uninsured/underinsured motorist bodily injury: $25,000 per person $50,000 per accident |
Tennessee | $25,000 | $50,000 | $15,000 | None |
Texas | $30,000 | $60,000 | $25,000 | None |
Utah | $30,000 | $65,000 | $25,000 | Personal injury protection: $3,000 per person Uninsured motorist coverage: $30,000 per person $65,000 per accident |
Vermont | $25,000 | $50,000 | $10,000 | Uninsured/underinsured motorist bodily injury: $50,000 per person $100,000 per accident Uninsured/underinsured property damage: $10,000 |
Virginia | $50,000 | $100,000 | $25,000 | None |
Washington | $25,000 | $50,000 | $10,000 | None |
West Virginia | $25,000 | $50,000 | $25,000 | Uninsured/underinsured motorist bodily injury: $25,000 per person $50,000 per accident |
Wisconsin | $25,000 | $50,000 | $10,000 | Uninsured/underinsured motorist bodily injury: $25,000 per person $50,000 per accident |
Wyoming | $25,000 | $50,000 | $20,000 | None |
Certain states require that you add PIP and UM insurance to your policy to have legal car insurance. These coverages are moderately priced at about $50-$150 annually each, but will add to your policy cost.
Personal Injury Protection (PIP) covers medical expenses, lost wages, and essential services for you and your passengers regardless of who caused the accident. PIP is primarily required in no-fault insurance states, where each driver's insurance covers their own injuries regardless of who caused the accident.
States: Delaware, Florida, Hawaii, Kansas, Massachusetts, Michigan, Minnesota, New Jersey, New York, North Dakota, Oregon, Pennsylvania, Utah
Uninsured Motorist coverage protects you if you're in an accident with a driver who has no insurance by covering your medical expenses and, in some states, property damage.
States: Connecticut, District of Columbia, Illinois, Kansas, Maine, Maryland, Massachusetts, Minnesota, Missouri, Nebraska, New Hampshire, New Jersey, New York, North Carolina, North Dakota, Oregon, South Carolina, South Dakota, Vermont, Virginia, West Virginia, Wisconsin
Underinsured Motorist coverage pays for your expenses when you're hit by a driver whose insurance limits are too low to cover all your damages.
States: Connecticut, Maine, Maryland, Massachusetts, Minnesota, Nebraska, New Jersey, North Carolina, North Dakota, Oregon, South Dakota, Vermont, Virginia, Wisconsin
Though state minimums are less expensive, we strongly recommend higher liability coverage.
You have minimum 25/50/25 auto liability coverage and cause an accident that totals a new Range Rover Sport ($100,000 value) and results in $50,000 of medical expenses for the other driver. Your insurance would only cover $25,000 of the vehicle damage and $25,000 of medical costs, leaving you personally responsible for the remaining $75,000 for the vehicle and $25,000 in medical costs.
You could be sued for this amount plus potential additional damages for pain and suffering or lost wages. This is why higher liability limits provide important protection for your personal assets.
Determining your liability coverage is the first decision when choosing how much car insurance you need. Factors that should drive your decision for how much liability coverage you need.
How much car insurance you need depends on your driver profile and location. Below are MoneyGeek's recommendations for liability coverage amounts and coverages you should buy.
Higher deductibles and lower liability limits reduce monthly premiums. You're protected legally while minimizing costs, but you'll pay more out-of-pocket if you cause a serious accident.
Multiple drivers mean higher accident risk, but multi-car discounts offset costs. Higher liability limits protect your family's assets, and comprehensive coverage handles weather damage to vehicles parked outside.
Your wealth makes you a lawsuit target. Higher limits and umbrella policies protect assets beyond your home and cars. Premium coverage ensures your expensive vehicle gets proper repairs with OEM parts.
Teen drivers are 3x more likely to cause accidents. Higher liability limits protect your family from lawsuits. Teens under 18 can't purchase insurance without a parent/guardian co-signer in most states.
Past violations make you statistically more likely to have future accidents. Don't compound the financial damage by carrying inadequate coverage. Higher limits protect you from personal bankruptcy if you cause serious harm.
Liability coverage protects you financially when you're at fault in an accident, covering two main components:
What the 100/300/100 numbers mean: The first 100 refers to the bodily injury liability limit per person ($100,000), 300 refers to the bodily injury liability per accident ($300,000), and 100 refers to the property damage liability ($100,000).
Liability insurance is required in 49 states; New Hampshire is the exception.
MoneyGeek expert recommendation: Most drivers need 100/300/100. You can choose less if you have very low assets and are financially constrained, or more (e.g., 250/500/250) if you have high assets.
These two coverages protect your own vehicle and are typically presented together as "full coverage" when combined with liability:
These coverages are important for newer vehicles and required for those with loans/leases. Both coverages require choosing a deductible (the amount you pay before insurance covers the rest). Higher deductibles reduce premiums but increase your out-of-pocket costs when filing claims. For example, increasing your deductible from $500 to $1,000 can save approximately 20-30% on these coverage portions.
MoneyGeek expert recommendation: Most drivers need comprehensive and collision coverage unless they drive a car valued at less than $3,000 and have the ability to pay for their own car repairs.
These coverages handle injury expenses for you and your passengers:
These coverages work alongside health insurance but often cover things health insurance doesn't, like dental injuries and funeral costs.
MoneyGeek expert recommendation: Unless required in your state (see list below), most drivers don't need this coverage if they have solid health insurance and disability. You should add it if you want premium protection.
This protection activates when you're hit by a driver with insufficient or no insurance:
The national uninsured driver rate has increased to approximately 12%, with rates exceeding 20% in some states. It's relatively inexpensive coverage that protects against a common risk.
MoneyGeek expert recommendation: Most drivers need this coverage to protect themselves against uninsured drivers. It is required in certain states (mentioned below).
Insurance providers standardize coverage into four main categories. Â Here's what each one covers and why you need it:
Take our four-step quiz to learn the required and optimal level of car insurance for you.
100/300/100 coverage provides good protection for most households. This liability amount costs around $1,200 annually on average when combined with full coverage or about $600 for liability-only policy, but provides 4-10 times more protection than state minimums. Â Those with high assets should consider 250/500/250.
Most drivers pay $1,000-$1,500 annually for recommended 100/300/100 coverage, while higher limits cost more monthly but protect you from potentially devastating out-of-pocket expenses if you cause a serious accident.
Coverage Level | Best For | Typical Annual Cost |
|---|---|---|
State Minimum | Not recommended, unless you are struggling to afford insurance | $500-$700 |
50/100/50 | Budget-conscious drivers, those will less assets | $700-$900 |
100/300/100 | Most drivers | $1000-$1500 |
250/500/100+ | High-net-worth individuals | $1500+ |
If your car is financed or leased, you must carry full coverage - it's a lender requirement, not optional.
For vehicles you own outright, the decision comes down to math and risk tolerance. Skip full coverage if your car is worth less than $3,000 or if annual comprehensive and collision premiums exceed 10% of your vehicle's value.
Full coverage makes sense for newer vehicles (less than 10 years old) or those worth more than $4,000. It's especially smart if you live in areas with high theft rates or severe weather, or if you can't afford $5,000-$15,000 in unexpected repair costs.
Most drivers need full coverage and should add collision and comprehensive. Â This protects your vehicle. If you drive a low value vehicle, typically below $3,000, and have the money to buy a new car or repair it in the case of a bad accident, you can consider dropping this coverage.
Optional add-ons can give you peace of mind and convenience in the case of an accident. These optional coverages enhance your policy for specific situations:
With exception of GAP coverage which is required for leased vehicles, adding these coverage types is personal preference. Â We recommend new car replacement for cars less than two years old and rental car reimbursement if you don't have alternative transportation and to drive often.
When you finance or lease a vehicle, the lender typically requires certain coverages. Â They will ask for proof of coverage.
MoneyGeek expert recommendation: You should choose a $500 or $1,000 deductible.
A deductible is the amount you pay out-of-pocket before insurance coverage pays for a claim:
You should choose a $500 or $1,000 deductible. If you choose the higher amount, you will save $100-$200 per year, but make sure you have an emergency fund to pay it in the case of an at-fault accident.
An umbrella policy is extra liability coverage that layers on top of your auto (and often home or renters) insurance, paying any lawsuit costs that exceed your underlying limits—typically in $1 million increments up to $5 million or more.
How Umbrella Polices Work
Your auto policy pays first when you’re liable for injuries or property damage. If a settlement is higher than those limits, the umbrella policy covers the excess.
Who Should Get an Umbrella Policy
Anyone with significant assets, high income, or added risk from teen drivers, rental property, or frequent driving should consider an umbrella policy. It adds extra liability protection beyond your auto or home insurance, helping shield your savings and future earnings from costly lawsuits.
Ensure you are getting the best rate for your insurance. Compare quotes from the top insurance companies.
Choosing the right car insurance can be overwhelming. Here are answers to common questions to help you decide how much coverage you need.
You should carry liability coverage at least equal to your net worth (your assets minus debts). Most insurance experts recommend minimum liability limits of 100/300/100 for adequate protection.
State minimum liability insurance often fails to provide adequate financial protection. MoneyGeek suggests opting for 100/300/100 liability coverage. Full coverage insurance may be required if you're leasing or financing your car.
For a new or expensive car, purchase full coverage with liability limits of 100/300/100, comprehensive and collision coverage with $500-$1,000 deductibles, and gap insurance if financing. Consider adding new car replacement coverage, which provides a brand-new vehicle rather than depreciated value if yours is totaled in the first 1-2 years of ownership.
Car insurance follows the car, not the driver. Your insurance covers anyone who drives your vehicle with permissive use.
Most insurance companies allow adding up to four or five cars to a multi-car policy if they're all kept at the same address. While each vehicle needs liability insurance, you can choose which cars get collision or comprehensive coverage.
A higher deductible (like $1,000) results in lower monthly premiums but means you'll pay more out-of-pocket when filing a claim. Most insurers report that raising a deductible from $500 to $1,000 can reduce premiums by 15-30%.
Gap insurance covers the difference between what you owe on your car loan and the vehicle's actual cash value if it's totaled or stolen. It's highly recommended for new vehicles with small down payments or long-term financing, and is often required for leased vehicles.
Purchase your new policy before canceling your old one, setting the new policy's start date to match or overlap with your old policy's cancellation date. Even a single day without coverage can result in higher rates and potential legal penalties.
Study Overview
MoneyGeek determined car insurance costs using quotes from various locations with a sample driver profile. We analyzed state liability coverage limits, average costs and policy coverage types.
Data Sources and Depth
We sourced data from Quadrant Information Services and state insurance departments. Our analysis includes over 500,000 quotes across 46 providers and 473 ZIP codes.
On This Page
This pages cites coverage add-on costs and average costs ranges for liability coverage. Â Add-on cost came directly from insurance company online quotes. Â Liability policy cost ranges were averaged from our data base of quotes with the driver profile below.
Driver Profile
To estimate average annual auto insurance rates, we used this sample driver:
About Mark Fitzpatrick
Mark Fitzpatrick, a Licensed Property and Casualty Insurance Producer, is MoneyGeek's resident Personal Finance Expert. With over five years of experience analyzing the insurance market, he conducts original research and creates tailored content for all types of buyers. His insights have been featured in publications like CNBC, NBC News and Mashable.
Fitzpatrick holds a master’s degree in economics and international relations from Johns Hopkins University and a bachelor’s degree from Boston College. He's also a five-time Jeopardy champion!
Passionate about economics and insurance, he aims to promote transparency in financial topics and empower others to make confident money decisions.
