The Definitive Guide to Auto Insurance

By LoweredRates.com

Unlike many other countries, American roads were designed primarily for the individual motorist, making a car all but necessary for people to get around. Unfortunately, car ownership is not without its risks, and the US has 50% more road deaths than comparable countries like Canada.

Auto insurance helps mitigate the financial risks of driving a car. Policies can pay out in the event of car accidents, unforeseen accidental damage to your vehicle, and more. This definitive guide will cover a wide range of car insurance topics, including types of coverage, rates, minimum coverage guidelines, and more.

A red toy car and car keys

What is an Auto Insurance Policy?

An auto insurance policy is an agreement between the owner of a vehicle and an insurer. The car owner pays for coverage, and in return, the insurer will pay out up to a certain amount in certain conditions. The situations where the insurer pays out are determined by the type of coverage that the car owner pays for.

Types of coverage can come in many forms, including liability insurance, which is usually the bare minimum required to operate a vehicle. Other kinds of coverage include comprehensive, collision, and more. This guide will elaborate on the differences between these forms of coverage later on.

Why Do Car Owners Buy Auto Insurance?

The most direct answer is that car owners buy auto insurance because it is legally mandated in 48 out of 50 states in the US, but the reasons for car insurance go beyond just laws. Cars and medical costs are expensive, and if you end up liable for an accident, you may have to pay for medical and repair bills for the other motorist.

Since liability insurance will protect the driver who is at fault, auto insurance provides financial security for motorists. With the right coverage, insurance can also kick in if a vehicle is stolen, vandalized, damaged by the weather, or even crashed in a single-car accident.

How Has Auto Insurance Changed Over the Years?

Massachusetts was the first US state to make auto insurance compulsory, all the way back in 1925. Until the mid-1950s, Massachusetts was the only state in the country with mandatory car insurance before the rest followed suit.

Types of Auto Insurance Coverage

This part of the guide will focus on the differences between various forms of auto insurance coverage. When buying auto insurance, many drivers consider their most significant risks and pick their coverage accordingly.

While liability coverage is typically the only mandatory form of coverage, some states require uninsured motorist and medical payments coverage, as well.

Liability

Liability coverage is designed to cover the expenses of another driver when you crash into them, and you’re found to be at fault. Liability coverage usually has two parts to it.

Bodily injury coverage will pay out when the other driver has suffered an injury that you are liable for. It will cover the other driver’s accident-related medical expenses, emergency care fees, and even lost wages due to the injury.

On the other hand, property damage coverage will cover any repairs to the other driver’s vehicle and any damage to the surrounding property during the accident. Even damage to fences and buildings is covered by liability insurance.

Keep in mind that the vast majority of liability policies have different coverage limits for bodily injury and property damage. While property damage limits will be determined per accident, bodily injury limits are split in two: one limit per person and one limit for the entire accident.

Collision

While liability coverage will only pay for the repairs to the other party’s vehicle, collision coverage will instead pay for your repairs. This kind of coverage can kick in if you get into a car accident that you were liable for. If the other party is responsible for an accident, your repairs will instead be covered by their liability insurance.

Collision insurance will also pay for repairs in collisions that didn’t involve a second party. If you hit a pillar in an underground parking garage and damage your wing mirror, that will be covered under most collision insurance policies.

A lady calling car insurance with open-bonnet car behind her

Comprehensive

Comprehensive coverage is another form of auto insurance designed to pay for repairs to your own vehicle. While collision insurance will cover situations where the driver is in control, comprehensive insurance will pay out when factors are out of the insured’s hands.

Two of the most common sources of comprehensive insurance claims are vandalism and theft, which is why comprehensive insurance is typically an attractive choice for owners of expensive cars. Comprehensive coverage will also kick in due to fire, hail, falling trees, natural disasters, and civil disturbances.

The one form of collision that is covered by comprehensive insurance is when you get into an accident with a wild animal. In these cases, comprehensive coverage will pay out since the matter was not under your control.

Medical Payments

Medical payments coverage is similar to collision insurance in that it will pay out regardless of who caused the accident. While collision coverage is meant to cover auto repairs, medical payments coverage will pay for your hospital bills and those of your passengers.

This kind of coverage is useful if you cause an accident and get injured in it. If the other driver is at fault, it can also help pay for medical bills that are more expensive than their policy limit.

Personal Injury Protection (PIP)

PIP (Personal Injury Protection) is only available in no fault states, and it is essentially the same thing as medical payments coverage, which is only available in at fault states. There are only a couple of differences between these forms of coverage.

The first difference is that PIP is legally mandated in some states, while medical payments coverage is always an optional add-on. The second difference is that PIP will also cover lost wages due to injury, while medical payments coverage will only pay for medical bills directly.

No Fault vs At Fault States

In the USA, there are two auto insurance systems: the more common “at fault” system and the less prevalent “no fault” system. Here’s what sets them apart:

At Fault States

This is the more traditional form of car insurance in which the responsible driver is determined before either of the insurance companies pay out. Keep in mind that the blame for an accident may not be black-and-white, and insurers will frequently assign a percentage to each driver to determine how much of the fault was theirs.

The driver who shares the majority of the fault will be responsible for paying the bills of the other parties, either through their liability insurance or out of their pocket. If the other parties feel that they have been paid insufficiently for damages, they can file a lawsuit against the responsible driver.

At fault insurance is far more common in the US, with 38 states using this kind of system to determine auto insurance payouts.

No Fault States

No fault car insurance was created during the 1970s to help combat the growing number of small claims clogging up the legal system. Under the no fault system, your own insurance company is responsible for paying out for the injuries you sustain in an accident under PIP.

Keep in mind that insurance companies will still investigate to determine who is at fault in the accident. The responsible driver will have their risk rating increased and will have to pay higher premiums. In most cases, the no fault system makes it impossible to sue the responsible driver, though there are some exceptions.

Typically, damages need to exceed a certain threshold in no fault states before a lawsuit can be filed.

Add-On Coverage

There are several add-ons that you can add to your auto insurance policy. These won’t cost as much as a whole different form of coverage, but they will pay out in specific circumstances or may help keep your premium low after an unfortunate event on the road.

Gap Insurance

Gap insurance is typically purchased by new car owners at the dealership or by drivers who are loaning their cars. Since insurance payouts are based on your vehicle’s value, depreciation may make your insurance payout lower than the amount of money you still owe on the car.

Gap insurance will make up for the gap between the insurance payout and the amount that you still have to pay off on your loan.

For example, if a $35 000 car is totaled and depreciation has reduced its value to $30 000, that’s all the insurance company will pay out without gap insurance. However, you’ll still owe $35 000 for the car, provided you haven’t made any of your payments yet. Gap insurance will pay out that extra $5000.

Uninsured or Underinsured Motorist Coverage

The next kind of add-on is uninsured/underinsured motorist coverage. It pays out when the liable party in the accident either doesn’t have insurance or doesn’t have a high enough policy limit. Some states require this kind of add-on by law.

Uninsured and underinsured coverage are more prevalent in states where there is a high presence of uninsured drivers. This is an extremely popular add-on in places like New Hampshire or Virginia, where liability insurance isn’t required by law.

Claims Forgiveness

This kind of endorsement will negate the insurance rate increase from the first accident that you cause. Claims forgiveness is often chosen as an add-on by young drivers who are still nervous on the road or drivers who live in an area where the weather can contribute to frequent crashes.

This kind of endorsement is also known as accident forgiveness. Keep in mind that it will only apply for your first at-fault accident, and any subsequent collisions will result in rate increases like normal.

Minimum Auto Insurance Coverage

Every state in the US except for New Hampshire and Virginia requires a minimum level of liability insurance. Some states may require additional coverage. Notably, no fault states will typically require drivers to have a minimum level of PIP coverage.

Minimum levels of coverage are provided in dollar values for both bodily injury and property damage liability. While the minimum coverage for property damage is measured per accident, minimum coverage for bodily injury is split into a max payout per person and a max payout per accident.

Keep in mind that minimum coverage is only the amount that you need to have to drive legally. There is no guarantee that these limits will cover you in case of a severe accident.

A man showing a holographic car illustration

Why States Require Liability Insurance

Auto liability insurance is required by all but two states because of the potential amount of harm that a driver can cause behind the wheel of a car. Without insurance, every collision would devolve into a lengthy legal battle, and many drivers would still be unable to pay out in the event of a lawsuit.

Liability insurance helps make sure that each driver can cover some, if not all, of the damages that they cause in an accident that they’re responsible for. Drivers would have much less peace of mind if every accident could potentially bankrupt them, and liability insurance helps prevent this.

New Hampshire and Virginia

The two exceptions to mandatory liability insurance for car owners are New Hampshire and Virginia.

New Hampshire doesn’t require a minimum level of liability insurance if the driver of the car can provide evidence that they can cover their liability in case of an accident. This means that drivers who are wealthy and have a high degree of liquidity may be able to avoid paying for insurance.

On the other hand, Virginians can choose between paying for an insurance policy or paying the state a $500 fee annually for being an uninsured motorist. Most Virginia drivers decide to pay for insurance instead, as cheap policies can be more affordable than the uninsured motorist fee, and they provide coverage.

Is Minimum Coverage Enough for You?

Many drivers are unsure if minimum coverage is sufficient for them, and they wonder whether they should expand their policy limits. As with many things in insurance, the policyholder must decide on a case-by-case basis, as everyone has a different budget for auto insurance.

Drivers with few assets and low income may not have the luxury of getting more than minimum coverage, but they also won’t have many assets to lose if they get sued for causing an accident. In these cases, it may make more sense to stick with minimum coverage instead of paying more.

On the other hand, drivers with expensive cars who live in areas with a lot of vandalism or severe weather may wish to invest in other forms of coverage, like comprehensive insurance. Drivers will have to consider their circumstances, their vehicle, and their budget before deciding whether or not minimum insurance will work for them.

A piggy bank on a car's bonnet

Why the Cheapest Insurance Can Get Expensive in the Long Run

The cheapest auto insurance policies typically only offer liability coverage. If you’re at fault in a crash, you’ll still have to pay for repairs to your own vehicle and any medical bills you have (provided you’re in an at fault state).

Instead of paying thousands of dollars for repairs and treatment, some drivers prefer a slight increase to their premiums that will leave them covered in these situations. Something like collision insurance can ensure that you don’t get stuck without a car while you gather the money to pay for repairs.

Cheap policies rarely ever offer locked rates, meaning that your premium can rise by quite a bit after your first year. This means that you’ll be paying more for relatively little coverage. A more expensive policy may offer better coverage with higher limits and a locked rate that won’t budge.

How Are Auto Insurance Premiums Priced?

The cost of auto insurance is based on a variety of factors, like any other kind of insurance. One of the most significant factors in determining auto insurance rates is the driver. If a driver is more accident-prone, they will be more of a risk to the insurance company, which will increase the likelihood of claims.

Along with the driver, environmental and geographical factors will also play a role in insurance rates. Car insurance rates can vary dramatically between geographically adjacent states, and this is due to factors like crime, population density, and a few other things.

Finally, auto insurance will also depend on the vehicle itself. Your rates may be tied to the car’s value, and you can get discounts for optional equipment that may reduce the risk of your vehicle getting damaged.

Environmental Factors

Environmental factors will influence auto insurance rates in two cases. The first includes elements that make accidents more likely, like more drivers on the road or harsh winter weather. The second case is when your car is more likely to be damaged by events out of your control, like crime and natural disasters.

Crime Rate

A higher crime rate will make a vehicle more vulnerable to vandalism or theft and will increase the likelihood of a claim. Insurers also tend to assume that areas with more crime will have less skilled drivers, raising the possibility of an accident.

Things like slashed tires and broken windows are far more common in areas with a higher crime rate, and this will increase the number of claims that the insurance company gets. Since they are taking a more significant risk by doing business in an area with a lot of crime, insurers pass on that risk to the customer through higher premiums.

Number of Drivers on the Road

Another factor that will dramatically influence auto insurance rates is the number of motorists on the road. This is based on population density, and areas with a lower population density will have fewer drivers using the roads. Being less likely to encounter another driver will also reduce your risk of an accident.

This is why insurance rates in rural areas tend to be far more affordable than in cities, though this is also influenced by the reduced chance of vandalism and theft in those very same areas.

Weather

The weather is another thing that will go into determining your insurance rates. Areas with excessive rain or snow will have more dangerous driving conditions than the driest states. Since this increases the risk of accidents and therefore claims, insurers will charge more due to adverse weather.

Northern states see the most considerable influence from the weather on their insurance rates because of the driving hazards related to snow and ice. Some insurers will even offer discounts to their customers who take defensive driving courses to prove that they can handle winter driving.

Natural Disasters

Natural disasters will damage a car just as surely as they’ll damage a building, so places vulnerable to tornadoes, hurricanes, earthquakes, and other hazards may see worse rates. While natural disasters can easily total a car, they are also much rarer than some of the other environmental factors, reducing their relative impact on the premium.

Natural disasters will typically fall under comprehensive insurance, though there are some exceptions. If you are driving during the event and another car crashes into you because of it, then that will fall under collision insurance. Any damage from the wind or earth movements will fall under comprehensive coverage.

At Fault or No Fault State

The final environmental factor that will influence your auto insurance premiums is whether you live in an at fault state or a no fault state. Research has shown that no fault states consistently have higher insurance rates than their tort-based counterparts. There are a few different reasons why no fault insurance has proven to be more expensive.

The first thing to consider is that no fault insurance covers twice as many parties as at fault insurance since both of the drivers get paid out in an accident. Since no fault insurance also reduces the at-fault driver’s responsibility for causing the accident, many insurers assume that no fault states encourage reckless driving.

Finally, mandatory medical payouts in the event of an accident will increase the likelihood of fraud, especially if the driver doesn’t have other forms of medical insurance.

Vehicle Factors

A small toy red car in a life buoy

When determining your insurance rates, companies will also consider the vehicle itself, though this is primarily for collision and comprehensive rates. If you’re just getting liability coverage, your car’s value won’t be a factor in the price since the repairs will be your responsibility.

Value of the Vehicle

If you’re trying to insure a vehicle under a comprehensive or collision policy, the insurer will have to determine the value of your car before they can come up with a rate. Cheaper cars will be less of a risk for insurers, as they won’t have to pay as much if you get into an accident.

On the other hand, some cars are so valuable that insurers will refuse to provide you with a typical car insurance policy. There are specific auto insurance policies for rare and vintage cars, and these are typically offered by insurers who only work with these types of vehicles.

Insurers will consider the age of your vehicle, how many miles it has been driven, its make and model, and a range of other aspects to determine how much it is worth. Keep in mind that the value they use to determine your rate isn’t the same as the ACV (Actual Cash Value) that they will pay out if the car is totaled.

Type of Car

Insurers will also consider the type of car that you have when determining your rates. A station wagon and a sports car of equal value will not have the same insurance rates because a sports car will be more likely to be driven aggressively, increasing the potential for an accident.

This is one of the only factors about your vehicle that will affect your liability rates, as there’s no guarantee that your car is the only one that will be damaged in a collision.

Annual Mileage

The number of miles that a car is driven each year will also affect insurance rates, as a vehicle that is on the road more often will be at higher risk of crashing. To an insurance company, every moment that a driver spends on the road is another opportunity to get into a car accident.

Drivers will have to carefully consider how much they drive every year when applying for car insurance. Some motorists will avoid using their car for shorter trips to cut down on their overall mileage, using alternatives like bicycles or public transit.

Personal Factors

Finally, the most impactful factors in determining car insurance rates are based on the driver. The person operating the vehicle will be the single most significant influence on the likelihood of an accident. Things like driving history, age, and your credit score may all impact your auto insurance rates.

Credit Score

Many car insurance companies will use your credit score to determine how much you pay for car insurance. This practice is legal in 47 states, though it’s banned in Massachusetts, Hawaii, and California. You may be wondering why your credit score would influence your insurance rate. It’s not like you’re getting a loan, right?

A credit score is a measure of an individual’s financial responsibility, so insurance companies assume that it can also be a measure of someone’s overall responsibility. Some drivers may argue that this is an unfair and unreliable technique, and that’s a large part of why the practice is banned in three states.

Age

One of the single most influential factors that insurance companies use to determine a driver’s rate is their age. While some young drivers may be better than others, insurance companies believe that driving experience is one of the best metrics to determine how good of a driver someone is.

Consider it this way. Insurance companies don’t have a lot of info about a driver who is just starting out, so the risk of a young person being a bad driver is much higher than with an older customer. Older clients tend to have driving histories that can be used to extrapolate more data about how big of a risk they are.

Since none of that data exists for younger customers, insurers err on the side of caution by assigning them a higher rate until they’ve proven that they’re good drivers.

Driving History

Of course, insurance companies will take a close look at a driver’s history before assigning them a rate. A driver who has plenty of traffic violations will likely see a much higher base rate than a driver who has never had a demerit point on their license.

The degree to which your driving history influences your rates depends on how long you’ve been driving. A new driver’s history simply doesn’t have the sample size for insurance companies to draw any reliable conclusions. On the other hand, someone who has gone forty years without an accident is likely a safe driver.

History with the Insurer

A driver’s history doing business with the insurance company is another factor that is considered when rates are being determined. The average driver will see their rates decrease every year that they’re with an insurance company, provided they don’t get into any accidents or get caught with traffic violations.

Some insurers will also reduce your deductible for every year that you go without making a claim, giving you further incentive to keep doing business with them in the long run.

Consider Your Lifestyle When Picking Insurance

This section will contain some hypothetical examples of car insurance customers. We’ll look at their circumstances, their choice of coverage, how much they pay, and why it works for their lifestyle.

Jeff

Jeff is a student who just moved out of his parents’ house. Jeff drives a 2001 Pontiac Sunfire. He doesn’t have any assets.

Jeff’s Auto Insurance

Jeff opts for his state minimum coverage of 25/50/10 since he has nothing to lose in a lawsuit if his responsibility exceeds his coverage limit. The low value of his car also means that collision and comprehensive coverage aren’t typically worth the money because of the low potential payout.

How Much Does Jeff Pay?

$720 per year

Adam

Adam is around 30 years old, and he has a decently-paying job and a few assets to his name. While Adam still rents his apartment, he plans to move into a house of his own eventually. Adam drives a 2013 Honda Civic.

Adam’s Auto Insurance

Adam has opted for 50/100/25 coverage in his liability insurance to make sure that he’s covered in a severe collision. To ensure that his own car can also be repaired in an accident, Adam also decides to get collision insurance, which comes out to about $300 per year.

How Much Does Adam Pay?

$1100 per year

Becky

Becky is 40 years old and uses her 2019 Nissan Rogue to drive her two children to school every day before heading off to work. The car was purchased new and is still being paid off. Becky and her husband own their house, so they have some significant assets to their names.

Becky’s Auto Insurance

For 100/300/500 coverage, Becky pays about $850 a year because she is an older driver with a good credit score. Since Becky’s Nissan Rogue is almost brand new, she decides to get collision coverage for $500 per year and comprehensive insurance for $400 per year.

Finally, since she’s still paying off her car, Becky gets gap insurance for an extra $20 per year.

How Much Does Becky Pay?

$1770 per year

Auto Insurance Companies

Picking the right car insurance company can influence your rates, the quality of customer service, the add-ons that are offered, and quite a bit more. This section will cover the differences between various insurance companies and explore how they are rated using the AM Best system.

Local Auto Insurance Companies

Local auto insurance companies are smaller than their national counterparts, so they should be able to provide more intimate personalization of your policies. You’ll be more likely to get in contact with a company representative, as national insurers tend to use call centers and automated customer support systems.

Many local insurers can also offer better rates than their national counterparts since they have lower overhead. Some will even be willing to stretch the rules and make exceptions for drivers with a low credit score or other factors that would increase rates when dealing with a national carrier.

National Auto Insurance Companies

National carriers operate around the United States, and they include some of the big players like Geico, Allstate, and State Farm. These companies typically have pricier rates than local insurers, but they have plenty of benefits that help even things out, including roadside assistance programs and consistent customer service.

While national carriers may not have personalized customer service like their local counterparts, they tend to feature 24/7 hotlines and chat systems that allow you to contact the company at any time. Another advantage to national insurers is that they’re frequently further ahead of the tech curve than their local competitors, offering apps and up-to-date websites.

Insurance Company Ratings (AM Best System)

AM Best has several different metrics, but its best-known is the FSR (Financial Strength Rating).

The AM Best FSR helps potential customers determine how likely an insurance company is to pay out their claims. Companies with a lower rating will be riskier to do business with as they may be vulnerable to a change in the economy or a sudden surge in claims that could bankrupt them.

Rating Symbol Rating Variant Description
A+ A++ These companies are the most likely to meet their financial obligations.
A A- Companies with an A rating are very likely to meet their outstanding obligations.
B+ B++ Companies rated B+ or B++ are likely to meet their financial obligations.
B B- These companies have a fair chance of meeting their obligations, though they’re vulnerable to economic shifts.
C+ C++ In this category, the likelihood of meeting obligations is marginal. These companies are vulnerable to economic shifts, as well.
C C- Companies with this rating have a weak chance of continuing to meet their obligations. Very vulnerable to the economy.
D None Insurance providers who are unlikely to meet their obligations. Extremely volatile and vulnerable to the economy.

The rating variants are used to add further granularity and distinguish companies that are in the same category. Companies with the “++” modifier are at the head of their categories, while those with the “-” modifier are at the bottom of their groups.

Common Auto Insurance Terms

In auto insurance, there is a bit of jargon that may be good to know, particularly if you’re shopping for an insurance policy.

Deductible

Your deductible is the amount that you need to pay before your insurance company covers the rest of the expenses. For example, a $500 deductible policy would require the policyholder to put $500 of their own money toward the claim before the insurance company pays out the rest, up to the limit.

Deductibles are a way for an insurer to prevent customers from filing a claim about every dollar worth of damage that’s been done to their vehicle. If a driver has a $500 deductible, they won’t file a claim for any damage below $500, as it will be their responsibility.

Exclusion

An exclusion is any form of damage that your auto insurance policy doesn’t cover. For example, an exclusion in a liability policy would be any damage to your vehicle. However, collision and comprehensive coverage both have a few exclusions that prospective insurance buyers will want to know about:

  • Tire wear
  • Damage sustained during a race
  • Wear and tear
  • Mechanical failure
  • Broken glass

Premium

The insurance premium is the amount that a customer pays for their auto insurance policy. If a policyholder fails to pay their premium, the policy may be canceled, and the previous policyholder will still be on the hook for any fees resulting from that cancelation.

Replacement Cost

Replacement cost is defined by the amount of money it takes to replace the vehicle when it is totaled. If you have replacement cost coverage, most insurers will allow you to choose between a replacement vehicle of the same type or an equivalent amount of cash.

A vehicle’s replacement cost is one of the metrics that insurers use to determine how much they will pay out in a typical policy. It is also possible to opt for either replacement cost insurance or a replacement cost endorsement, both of which will pay out the full amount instead of ACV.

Actual Cash Value

The ACV (Actual Cash Value) of a car is determined by taking its replacement cost and subtracting depreciation from it. This is the amount that insurers will pay out if your vehicle is totaled in a standard policy, and it can be quite a bit lower than what you paid at the dealership for the car.

A vehicle starts losing value the minute it is purchased and driven off the lot, and that value will keep depreciating as it is driven more total miles and has to deal with more wear and tear.

a man with a toy car in palm and holding car keys in other hand

Common Reasons for Claims Being Denied

Keep in mind that there are a few different reasons why a claim may be denied. Drivers may wish to look over these reasons and ensure that they avoid situations where their claim may not be considered valid by their insurance company.

The Driver is Not On Your Policy

When you get a car insurance policy, you need to provide the names of all of the people above driving age in your household. Some companies may make you sign a waiver that will guarantee that a young, high-risk driver will not use your car. If this driver uses the car and gets into an accident, your claim will likely be denied.

Most policyholders will sign waivers like these to ensure that their insurance premium doesn’t increase dramatically due to it also covering a high-risk driver. Not disclosing someone in your household who is of driving age may also be grounds for claims denial, as the company may think that you were letting them drive using your policy.

The Car Was Being Used for Business During the Accident

Commercial use is a common reason for auto insurance claims being denied, as personal and commercial insurance policies are separate, with the latter being more expensive. Insurers charge more for business policies because they assume that a business vehicle will be used more frequently, increasing the risk of accidents.

Keep in mind that this can also apply to ride-sharing businesses like Uber, as your personal policy likely won’t cover you if you crash while working as an Uber driver. However, more and more insurance companies are starting to offer ride-sharing insurance policies or add-ons.

Avoidability

If something could have been done by the policyholder to stop the accident from occurring, the claim will likely be denied. For example, if a driver gets into an accident while driving recklessly or under the influence of drugs or alcohol, the insurance company will deny their claim.

In some northern states, you may even be considered negligent if you don’t have winter tires on your car past a specified cutoff date, and insurers may deny your claim.

Misleading Info

If you provide an insurer with wrong info that could have influenced your insurance premiums, they are well within their rights to deny your claim. The false information doesn’t need to be intentionally provided either. Something as innocent as failing to inform your insurer of your new address can render your insurance void when you need it most.

Always go over your insurance information every so often to ensure that nothing has changed and that none of your data is unintentionally misleading. While updating your info may end up raising your premium, it’s better than paying for insurance and then having your claim denied.

Ways to Lower Your Car Insurance Rates

There are a few different strategies that drivers can use to lower their insurance premiums. Most of these involve discounts that insurance companies offer for installing certain pieces of equipment or respecting specific conditions.

Low Mileage Discounts

Most car insurance companies provide their customers with low mileage discounts. Since less time spent on the road means that you’re less likely to get into a car accident, drivers with low mileage will be less of a financial risk to the insurance companies that are covering them.

There are even “black box” insurance policies that track the exact mileage your car is driven through a unique piece of equipment. This will allow insurers to make sure that you’re respecting the low mileage stipulation of your policy, and this results in much lower insurance rates.

Anti Theft Devices

Car insurance companies will also provide discounts to drivers who install anti theft devices on their vehicles to limit the risk of their car being stolen. There are many different devices that you can install on a car to deter would-be thieves.

The least advanced of these include steering wheel locks and parking boots, but these tend to be just as much of a nuisance to the driver as they are to the thief.

However, there are also more advanced options like vehicle trackers, internal camera systems, and electrical kill-switches. You may wish to discuss potential anti theft discounts with your insurance company, as the details will vary from provider to provider.

Good Student Discounts

Many car insurance companies mitigate the high cost of insuring young drivers by offering good student discounts to policyholders who keep their college grades above a certain threshold. Most companies will mandate at least a B average for the discount to apply.

Other insurance providers will offer a tiered approach where a B grade will shave off a certain percentage of the rate, and an A grade will result in an even more significant discount.

Assigning Risky or Inexperienced Drivers to Your Cheap Car

If you have more than one vehicle on your policy and want to have a younger driver included, sign a waiver that assigns them to your more affordable car. If you fail to specify this, the insurance company will assume that the young driver uses both vehicles, which may drive up your premium.

Drivers with a poor history on the road and multiple demerit points are also frequently assigned to more affordable vehicles, as they’re often just as much of a risk to the insurer as young drivers.

Increasing Your Deductible

When a driver increases their deductible, they will typically reduce their annual insurance premium. In a way, raising your deductible is much like gambling against the possibility that you will end up in an accident. This is also helpful if you have an emergency fund, and you’re able to pay a higher deductible out of your pocket.

Assigning a higher deductible to your policy shows the insurer that you’re less likely to file a claim if your vehicle gets damaged. This is because the owner will have to cover any damage that doesn’t exceed the amount of their deductible, and minor vehicle damage is far more common than severe damage.

Bundling

Another technique that insurance buyers use to reduce their rates is bundling several different kinds of insurance with the same company. For example, a car insurance plan and a home insurance plan from two separate providers may come out to $3000 a year, but bundling them together with the same company may only cost $2750 a year.

However, this also complicates buying insurance, as you’ll have to average out the cost of both insurance policies and then apply the bundling discount to compare rates between competitors. If you’re patient and willing to do a bit of math, this can potentially save you money every year.

Certificates of Financial Responsibility (CFRs)

CFRs are filed through the DMV and attached to your insurance policy in specific cases. Most drivers won’t need a CFR to get insurance, but certain black marks on your driving record may make it necessary. The most common reason for drivers needing a CFR is a DUI conviction.

Other reasons for requiring a CFR include an unreasonably high rate of car accidents or unpaid tickets over a certain threshold. Without a CFR, you won’t qualify for high-risk insurance (which is usually the only kind of insurance available to people with any of the above on their records).

SR-22

The SR-22 form is the most common of the two by far, as it is used in all 50 states. When an SR-22 is attached to an insurance policy, it shows that the driver is financially responsible and lets your state DMV know the details of your insurance. It will also automatically notify the DMV if your coverage lapses.

The SR-22 will typically cost a one-time fee of $25. This fee will not recur when you renew your policy, provided you haven’t allowed it to lapse. While Virginia and Florida are the only states that use the FR-44, they also use the SR-22 for cases not covered by the FR-44 certificate.

Another critical difference between the SR-22 and the FR-44 is that the former typically has similar limits to minimum liability insurance, though the premium will be higher.

FR-44

On the other hand, the FR-44 has much higher limits than the SR-22 and a far more expensive premium. The FR-44 form is only used in Virginia and Florida, and they are used in different cases across both states.

When Do I Need an FR-44 in Florida?

Florida mandates that any driver cited for a DUI must get an FR-44 CFR before they are allowed to have their license reinstated. Minimum liability coverage for a driver with an FR-44 in Florida is 100/300/50.

When Do I Need an FR-44 in Virginia?

Virginia drivers need an FR-44 certificate when they’ve been cited for a DUI, driving with a suspended license, or causing serious bodily harm while under the influence. Minimum coverage in Virginia with an FR-44 comes out to 50/100/40.

lots of cars parked in an area

FAQs

What should I look for when comparing policies?

While the first thing that potential customers will consider is the premium, there are a few other aspects that they may consider when comparing two policies. You may want to compare the two companies’ customer service index, as that will let you know what to expect when you have to deal with them one-on-one.

Of course, buyers should always check the exceptions in both policies to ensure that none are out of place. It may also be wise to take a detailed look at the coverage and the policy limits for each of them, as they may not always be readily apparent.

How much coverage should I get?

There is no such thing as a one-size-fits-all auto insurance policy, and the amount of coverage that a driver should get will depend on a variety of personal factors. Perhaps the most significant one is the buyer’s budget. Many drivers will come up with a budget first and then shop for car insurance.

Knowing your comfortable budget may allow you to select the forms of coverage that you require and then increase your limits until you’ve reached the upper limit of your budget. Many drivers will opt for higher limits to keep them financially protected in case they get into a severe car accident.

Do states set limits on what auto insurance companies can charge?

The vast majority of states will not directly set limits on what auto insurance companies can charge, but they will review their rates to ensure that they aren’t overcharging. Every year, insurance companies send their rates to the state so that they can be reviewed and approved.

The only state that doesn’t operate like this is Massachusetts, where the state sets a concrete limit that the insurance companies have to abide by.

Are there any states today that don’t require insurance?

There are two states in the Union where car insurance isn’t necessary. The first of these states is Virginia. To drive uninsured in The Mother of States, it is necessary to pay a $500 fee directly to the DMV. This charge is known as the UMV (Uninsured Motor Vehicle fee). Since this is about the same price as minimum coverage, very few Virginia motorists choose to drive uninsured.

The second state where minimum liability insurance isn’t necessary is New Hampshire. Drivers in The Granite State will need to prove that they can pay a minimum amount of damages out of their own pocket. This allows wealthy motorists to drive without insurance, though most wealthy drivers instead opt for the protection of an insurance policy.

Auto Insurance Across the 50 States

Now that the basics have been covered, the next section will be dedicated to auto insurance in each state. Unlike other kinds of insurance, states have a lot of leeway in determining how auto insurance works, and this results in otherwise similar places having drastically different insurance rates.

Along with rates, this section will cover the prevalence of uninsured motorists, the most common vehicle, and the number of collisions annually per state.

Alabama

Fun fact: Alabama’s main export is cars, with the state having sent over 7.5 billion dollars worth of vehicles overseas in 2018 alone.

Average insurance rate: $868

5 Most Popular Companies:

  1. Allstate
  2. Berkshire Hathaway
  3. Farmers Insurance
  4. Liberty Mutual
  5. Nationwide
Percentage of uninsured drivers in the state Most Common Car Number of collisions per year
18.4% Ford F-150 953

Overview

Alabama follows a “fault” system for auto insurance, so the party who caused the accident carries the responsibility of paying whoever suffers any damages because of that accident. This is why car insurance is important – it can cover the losses of the driver “at fault,” up to certain limits of the policy.

In Alabama, anyone that is injured or sustains damage to their person or property can file claims with their chosen insurance provider, file a claim with the driver that’s responsible’s insurance company, or can seek damages by using civil courts to file a lawsuit against the driver responsible.

This is where states differ when it comes to claimants’ rights and options. In states with “no-fault” systems in place, claimants do not have a myriad of choices that some states do. The injured must file the claim with his or her own insurance company, and rely on insurance and out-of-pocket money to cover medical bills and other expenses. If the claim goes beyond the limits of state or city law, then you can step outside of “no-fault” and file to hold the driver that is at fault responsible.

The fine for violating Alabama’s Mandatory Liability Insurance law is at least $500 for a first offense. A second (and subsequent) violation can result in a $1,000 fine and the suspension of the driver’s license for six months.

Coverage Type Coverage Amount
Bodily Injury $25,000 (per person) / $50,000 (per accident)
Property Damage $25,000

Alaska

Fun fact: Just over 10% of the cars in Alaska have personalized license plates.

Average insurance rate: $1,028

5 Most Popular Companies:

  1. USAA
  2. State Farm
  3. Travelers
  4. Progressive Group
  5. Chubb
Percentage of uninsured drivers in the state Most Common Car Number of collisions per year
15.4% Ford F-150 80

Overview

With an area of 570,641 square miles, Alaska is by far the biggest state in the US. However, according to Forbes Advisor, Alaska ranks number 10 in the nation for the highest percentage of uninsured drivers. According to the Insurance Research Council, about 15% of Alaskan drivers have no car insurance. If someone is involved in a car crash with an uninsured driver, they can file a lawsuit, but that is usually time-consuming and costly.

In some Alaska counties where car registration is not required, car insurance is also not mandatory. The Alaska Division of Motor Vehicles has a list of counties that are exempt from car registration and the mandatory auto insurance law. However, someone who has received a traffic violation of six points or more within the last five years must have liability insurance.

Even in counties where car insurance is not mandatory, auto insurance in Alaska is still important. Due to its geographical location, climate, and hazardous winter driving conditions, drivers are prone to traffic accidents. Compared to the year-round weather conditions in most other states, Alaska has more days of snow accumulation, icy rain, and vast expanses of wilderness that can make driving more dangerous and treacherous – especially in the winter.

Alaska has a “financial responsibility” law. This means that in addition to carrying the mandatory minimum insurance coverage, the person causing the accident must also work with your insurance provider and any other parties involved in an accident to settle and pay all claims. The Alaska Division of Motor Vehicles enforces this law by suspending the at-fault’s driver’s license until all claims are settled, paid, taken to trial, or otherwise resolved. Another rule in place is the ban on texting while operating a motor vehicle for all drivers.

If a car is badly damaged in an event like a car accident, fire, or flood, it could be declared a total loss under Alaska law if the cost of repairs exceeds your car’s worth or insured value.

Coverage Type Coverage Amount
Bodily Injury $50,000 (per person) / $100,000 (per accident)
Property Damage $25,000

Arizona

Fun fact: 3.9% of the Arizona workforce works in the automotive industry.

Average insurance rate: $973

5 Most Popular Companies:

  1. Berkshire Hathaway
  2. Nationwide
  3. State Farm
  4. Allstate
  5. Progressive Group
Percentage of uninsured drivers in the state Most Common Car Number of collisions per year
12% Ford F-150 1,010

Overview

Arizona follows a “comparative fault” (also known as “comparative negligence”) system when it comes to auto insurance laws. Under this system, the at-fault driver is responsible for paying for damages to others. However, if both drivers share the fault, the responsibility for paying for damages can be shared or split by percentages. For example: If one party is found to be 75% at fault, their insurance company will pay a proportional amount, while the other party’s insurer would be responsible for the remaining 25%.

Liability insurance covers those injured or who suffer damages. Liability insurance never covers the injuries or damages to your car or property. It pays the other driver only.

Drivers who operate a motor vehicle without proper auto insurance coverage can face steep penalties, including the suspension of their driver’s license. Penalties for failure to show proof of insurance in Arizona are as follows: $500 fine and 3-month suspension of driver’s license for a first offense, $750 fine and 6-month suspension of driver’s license for a second offense, and $1,000 fine and a 1-year suspension of driver’s license for a third offense.

Coverage Type Coverage Amount
Bodily Injury $15,000 (per person) / $30,000 (per accident)
Property Damage $10,000

Arkansas

Fun fact: Bonnie and Clyde once stole a car and hid out near Fort Smith, Arkansas.

Average insurance rate: $906

5 Most Popular Companies:

  1. State Farm
  2. Liberty Mutual
  3. Chubb
  4. Allstate
  5. USAA
Percentage of uninsured drivers in the state Most Common Car Number of collisions per year
16.6% GMC Sierra 1500 516

Overview

Under Arkansas law, insurance companies must offer “no-fault” coverage and uninsured and underinsured motorist coverage. As of early 2020, a new state law took effect, which mandates that all drivers in Arkansas have proper auto insurance. Kait8 News reports: “The law covers only motorcycles and motor vehicles. If a driver does not have insurance, state officials will send the driver a letter telling them they have 30 days to get insurance, or their registration on the vehicle will be suspended. After that, it will cost $100 to have the registration reinstated.”

This new law creates a system to allow law enforcement officials to check the insurance status of drivers in real-time, and let officials know if the insurance has lapsed. The new law should also help address the problem of motor vehicle owners not having proper insurance. According to officials with the Arkansas Department of Finance and Administration, nearly 400,000 of the almost 2.9 million vehicles in Arkansas are not insured.

Coverage Type Coverage Amount
Bodily Injury $25,000 (per person) / $50,000 (per accident)
Property Damage $25,000

California

Fun fact: The first vehicle in California was registered in 1902, and by 1905, there were over 17 000 vehicles in the state.

Average insurance rate: $987

5 Most Popular Companies:

  1. Progressive Group
  2. Allstate
  3. Nationwide
  4. Chubb
  5. Travelers
Percentage of uninsured drivers in the state Most Common Car Number of collisions per year
15.2% Honda Civic 3,563

Overview

California auto insurance operates under the tort system, meaning that the driver who is at fault for a collision is the one who has to pay out for most damages on the part of the other driver. Despite this, claims are determined by the percentage of fault that a driver shares in an accident.

Even if one driver caused the accident, it’s possible that they both contributed to the situation sufficiently to determine that one driver shares 40% of the blame while the other shares 60% of it.

One of California’s most unusual things is that they have more lenient penalties for driving uninsured than other states. For a first offense, drivers will only be fined $200. Subsequent offenders will be fined $500 and will not risk jail time or the suspension of their license, raising questions about whether or not California’s penalties are strict enough.

Coverage Type Coverage Amount
Bodily Injury $15,000 (per person) / $30,000 (per accident)
Property Damage $5,000

Colorado

Fun fact: The Eisenhower Tunnel is at the highest altitude of any point on the Interstate: over 11 000 feet.

Average insurance rate: $982

5 Most Popular Companies:

  1. Berkshire Hathaway
  2. Farmers Insurance
  3. Liberty Mutual
  4. State Farm
  5. Travelers
Percentage of uninsured drivers in the state Most Common Car Number of collisions per year
13.3% Subaru Outback 632

Overview

Colorado previously operated under no fault auto insurance, but it was decided to change back to a tort system in 2003 after it was discovered that the no fault system didn’t accomplish many of its goals. In that year, Colorado became one of several other states that have expressed disappointment in the effectiveness of the no fault system.

In Colorado, drivers have one of three options after getting into a car accident, including filing a claim with their own insurance company, filing a claim with the other driver’s insurance company, and filing a suit. Under the previous no fault system, filing a lawsuit wouldn’t have been possible except for non-economic damages.

Colorado also has harsh penalties for drivers who go without insurance, including a four-point penalty on their license for each offense. First offenders are issued a $500 fine and a suspension of their license until they prove that they’re insured. Second offenses carry a $1000 fine and a license suspension for a minimum of four months.

For third offenses and later, the fine remains the same as the second offense, but the license suspension period goes up to eight months.

Coverage Type Coverage Amount
Bodily Injury $25,000 (per person) / $50,000 (total per accident)
Property Damage $15,000

Connecticut

Fun fact: Connecticut had the first speed limit for automobiles, implemented in 1901.

Average insurance rate: $1,151

5 Most Popular Companies:

  1. Allstate
  2. USAA
  3. Progressive Group
  4. Farmers Insurance
  5. Chubb
Percentage of uninsured drivers in the state Most Common Car Number of collisions per year
9.4% Nissan Rogue 294

Overview

Despite being a small state, Connecticut is known for a variety of things, from “Yankee Doodle” to its New England lobster. To take advantage of all the great things the state has to offer, you need a vehicle, and thus car insurance is required. Connecticut is often cited as one of the safest states in the USA. With few natural disasters in its long history, the biggest natural threat is snow, which usually falls about 5-8 inches per year. In this “fault” system state, the options for coverage include:

  1. Underinsured Motorist Coverage
  2. Uninsured Motorist Coverage
  3. Liability Coverage
  4. A range of add-ons such as rental reimbursement (in the event you need a car while your car is damaged), towing coverage, and glass coverage (in case your safety glass is damaged).
Coverage Type Coverage Amount
Bodily Injury $25,000 (per person) / $50,000 (total per accident)
Property Damage $25,000

Delaware

Fun fact: There are over 150 used car dealers in Delaware.

Average insurance rate: $1,241

5 Most Popular Companies:

  1. Chubb
  2. Farmers Insurance
  3. Nationwide
  4. Progressive Group
  5. State Farm
Percentage of uninsured drivers in the state Most Common Car Number of collisions per year
11.4% Chevrolet Silverado 1500 111

Overview

Delaware uses a derivative of the no fault system, which includes a minimum coverage level for PIP (Personal Injury Protection). All drivers must have a minimum of $15 000 per person and $30 000 of PIP to be allowed to drive.

Delaware law states that drivers responsible for an accident cannot be sued for medical bills or wages, provided the amount is covered by PIP insurance. If the cost of either of these exceeds the responsible party’s PIP coverage, then the driver who is not at fault is allowed to sue.

First offenders who are caught driving without insurance in Delaware must pay a maximum fine of $1500. The second offense is subject to a penalty of up to $3000, and either offense may be accompanied by a six-month suspension of your driver’s license.

Coverage Type Coverage Amount
Bodily Injury $25,000 (per person) / $50,000 (total per accident)
Property Damage $25,000
Personal Injury Protection $15,000 / $30,000

Florida

Fun fact: If you stay in Florida for over 90 days and you have a car, it must be registered in the state.

Average insurance rate: $1,257

5 Most Popular Companies:

  1. Farmers Insurance
  2. Liberty Mutual
  3. Progressive Group
  4. Allstate
  5. Berkshire Hathaway
Percentage of uninsured drivers in the state Most Common Car Number of collisions per year
26.7% Toyota Corolla 3,133

Overview

Florida is perhaps one of the only states where natural disasters pose a severe threat to vehicles and notably increase the average insurance premiums. Of course, the percentage of uninsured drivers and the relatively high number of collisions also contribute to the state’s relatively high insurance rates.

Florida is a no fault state for car insurance, with a minimum required PIP coverage amount of $10 000. One thing to keep in mind is that this may not cover up to the full amount that you owe. By law, your PIP coverage will only cover 80% of your medical bills and 60% of your lost wages.

When driving uninsured in Florida, drivers face the suspension of their license until they get insured for the first offense, as well as the $150 reinstatement fee to get it back. Second offenses will increase the reinstatement fee to $250, and third offenses will bring up this fee to $500.

Coverage Type Coverage Amount
Personal Injury Protection $10,000
Property Damage Liability (PDL) $10,000

Georgia

Fun fact: White, Georgia, is home to the world’s largest classic car junkyard.

Average insurance rate: $1,048

5 Most Popular Companies:

  1. Chubb
  2. Liberty Mutual
  3. Progressive Group
  4. Travelers
  5. USAA
Percentage of uninsured drivers in the state Most Common Car Number of collisions per year
12.0% Ford F-150 1,504

Overview

Since Georgia operates under an at fault system, drivers in the state are allowed to sue the other party for damages incurred in a car accident if that other party is at fault. Unlike some at fault states, Georgia uses the proportional comparative fault system, where the drivers have to pay based on the percentage of fault they shared in an accident.

Most of the time, these settlements are not paid directly, but instead through the insurance companies of each driver, provided they both have coverage. Keep in mind that the driver who shares more than 50% of the blame for an accident is unable to seek compensation from the other.

In Georgia, driving without insurance is considered a misdemeanor, and it will remain on your criminal record. Additionally, it results in a minimum fine of $200 and a license suspension for at least 60 days. Subsequent offenses can increase the fine up to $1000 and a license suspension of up to six months.

Coverage Type Coverage Amount
Bodily Injury $25,000 (per person) / $50,000 (total per accident)
Property Damage $25,000

Hawaii

Fun fact: Hawaii has some of the most car rentals per capita in the US because of the high proportion of tourists visiting the islands.

Average insurance rate: $873

5 Most Popular Companies:

  1. Allstate
  2. Chubb
  3. Farmers Insurance
  4. USAA
  5. Progressive Group
Percentage of uninsured drivers in the state Most Common Car Number of collisions per year
10.6% Toyota Tacoma 117

Overview

Since Hawaii features a minimum of $10 000 PIP (Personal Injury Protection), it is considered a no fault state. This means your insurance will cover medical and rehabilitation costs up to a maximum of $10 000 for each person in your car.

This also means that you will not be allowed to sue the responsible driver for causing the accident, which is a feature of the tort system in at fault states. Additional options include the adjustment of the PIP deductible, as well as PIP managed care.

In Hawaii, the penalties for operating a motor vehicle without insurance range from $500 to $1500. First offenders will also have their license suspended for three months. Beyond that first offense, driving without insurance will result in another fine as well as a one-year suspension of your license.

Coverage Type Coverage Amount
Bodily Injury $20,000 (per person) / $40,000 (total per accident)
Property Damage $10,000
Personal Injury Protection $10,000

Idaho

Fun fact: There are nearly 200 car washes in Idaho.

Average insurance rate: $680

5 Most Popular Companies:

  1. Berkshire Hathaway
  2. Liberty Mutual
  3. Progressive Group
  4. State Farm
  5. Travelers
Percentage of uninsured drivers in the state Most Common Car Number of collisions per year
8.2% Ford F-150 231

Overview

Drivers in Idaho operate under an at fault insurance system, meaning that fault needs to be established before either insurance company will pay out. This means that drivers may need to take it into their own hands to collect evidence at the scene of the collision, and witnesses can be another deciding factor.

Once the fault is determined, the at fault driver’s insurance company will be responsible for the other’s expenses up to a specific limit. At fault laws also allow the victim in a collision to sue the responsible driver for additional damages, especially (but not only) if they exceed their liability coverage.

Idaho drivers who are caught without insurance will be subject to a $75 fine in addition to administrative fees. They will also have their license suspended until they can prove that they have insured their vehicle. Additional offenses will increase the potential charge to a maximum of $1000.

Coverage Type Coverage Amount
Bodily Injury $25,000 (per person) / $50,000 (total per accident)
Property Damage $15,000

Illinois

Fun fact: You’ll find plenty of classic cars at any of the six auto museums spread throughout Illinois.

Average insurance rate: $885

5 Most Popular Companies:

  1. Farmers Insurance
  2. Berkshire Hathaway
  3. Allstate
  4. Progressive Group
  5. State Farm
Percentage of uninsured drivers in the state Most Common Car Number of collisions per year
13.7% Honda CR-V 1,031

Overview

Keep in mind that Illinois is an at fault state when it comes to car insurance, meaning insurance companies will not pay out a settlement until the fault in the accident is determined. The liability of the responsible driver can range from fully to partially accountable.

This state uses a system of modified comparative negligence, where the driver can only get damages if they share less than 49% of the fault for an accident. However, if the victim does share a percentage of the blame, their claim may be reduced by that percentage.

Driving without insurance in Illinois can result in a fine of $500 to $1000 in the case of a first or second offense. Drivers will also have their license revoked for up to three months, and they will have to pay a $100 fee to have it reinstated when they finally get their car insured.

Coverage Type Coverage Amount
Bodily Injury $25,000 (per person) / $50,000 (total per accident)
Property Damage $20,000

Indiana

Fun fact: An Elkhart businessman had to sell off his $31 million collection of cars to pay off his debts.

Average insurance rate: $755

5 Most Popular Companies:

  1. State Farm
  2. Nationwide
  3. Farmers Insurance
  4. Allstate
  5. Travelers
Percentage of uninsured drivers in the state Most Common Car Number of collisions per year
16.7% Chevrolet Silverado 1500 858

Overview

In Indiana, the victim in an accident can file a claim with the responsible party’s insurance company to be reimbursed for the damages sustained. This means that Indiana is an at fault state, as the driver who is at fault has to be determined before any money is paid out.

If the amount of damages exceeds the responsible driver’s insurance policy, the rest of the payout may come through underinsured motorist benefits. If the driver doesn’t have underinsured coverage, the victim may have to sue the responsible driver for any remaining damages.

Unlike other states, a fine is not mandated for a first offense when a driver is caught without insurance. However, the driver will have their license suspended for 90 days, and they will have to register for an SR22 CFR for three years. Subsequent offenses may carry a $500 fine and a license suspension for a year.

Coverage Type Coverage Amount
Bodily Injury $25,000 (per person) / $50,000 (total per accident)
Property Damage $25,000

Iowa

Fun fact: A collector in Ankeny, Iowa, has a garage filled with every Chevrolet convertible made since 1912.

Average insurance rate: $702

5 Most Popular Companies:

  1. Nationwide
  2. Chubb
  3. USAA
  4. Progressive Group
  5. Liberty Mutual
Percentage of uninsured drivers in the state Most Common Car Number of collisions per year
8.7% Chevrolet Silverado 1500 318

Overview

In Iowa, you can’t collect damages from the other driver if you are more than 50% responsible for a collision. This means that Iowa is an at fault or a tort state. However, if you are partially responsible for a crash, that percentage will be deducted from your settlement.

This means that a driver who shares 30% of the blame for an accident will only have 70% of their damages covered by the other driver’s insurance policy. Keep in mind that medical coverage will only pay out for the accident after the degree of fault has been figured out.

In Iowa, driving without insurance is punishable by a fine of up to $250 or an equivalent amount of community service. If it is discovered that you are entirely uninsured (as opposed to having forgotten your documentation), your vehicle may also be impounded.

Coverage Type Coverage Amount
Bodily Injury $20,000 (per person) / $40,000 (total per accident)
Property Damage $15,000

Kansas

Fun fact: Topeka, Kansas, was once known as the primary producer of luxury cars in the United States.

Average insurance rate: $863

5 Most Popular Companies:

  1. Progressive Group
  2. Farmers Insurance
  3. Travelers
  4. Berkshire Hathaway
  5. Allstate
Percentage of uninsured drivers in the state Most Common Car Number of collisions per year
7.2% Ford F-150 404

Overview

Kansas is one of the relatively few states in America that operates using a no fault insurance system. The term “no-fault” means that their minimum coverage includes PIP (Personal Injury Protection) that will pay out regardless of the driver who is at fault in an accident.

This also means that drivers will not have to wait for the fault to be assigned to either of the parties in a collision before they are paid out for their medical bills, as would be the case in an at fault state. The minimum coverage in Kansas also features loss benefits that will pay out to the family of a deceased motorist.

Fines for first offenders who are caught without auto insurance in Kansas include a $300 fee and a license suspension until insurance is acquired. Further offenses will result in longer license suspensions and may also incur charges of up to $1000.

Coverage Type Coverage Amount
Bodily Injury $25,000 (per person) / $50,000 (total per accident)
Property Damage $25,000
Personal Injury Protection $4,500 (medical expenses)
$900 per month
$25/day
$2,000 – burial, cremation, funeral expense
$4,500 – rehabilitation expense
Uninsured/Underinsured Motorist $25,000 (per person) / $50,000 (total per accident)

Kentucky

Fun fact: The Dixie Flyer, which was marketed as “The Logical Car,” was built in Louisville from 1916 until 1923.

Average insurance rate: $939

5 Most Popular Companies:

  1. State Farm
  2. Travelers
  3. Berkshire Hathaway
  4. Chubb
  5. Nationwide
Percentage of uninsured drivers in the state Most Common Car Number of collisions per year
11.5% Ford F-150 724

Overview

Unlike most other states in the USA, Kentucky uses a no fault system when determining car insurance payouts after an accident. This means that both companies will pay out for any damages that were caused by the accident before the blame is assigned to either driver.

However, no fault insurance in Kentucky gives drivers the option to opt out and instead pursue claims against the responsible driver in case of an accident. If the driver opts out of the $10 000 PIP coverage, they will also open themselves up to a potential lawsuit if they are responsible for a collision.

The first time you are caught driving without insurance in Kentucky, you are subject to a fine of $500 to $1000, and you may be imprisoned for up to 90 days. Your license will also be suspended until you provide proof of insurance. Further offenses may be punished with fines of up to $2500 and 180 days in prison.

Coverage Type Coverage Amount
Bodily Injury $25,000 (per person) / $50,000 (total per accident)
Property Damage $25,000
PIP (May choose to opt out) $10,000

Louisiana

Fun fact: Shreveport, Louisiana, is home to a classic car museum that houses over 60 vintage vehicles.

Average insurance rate: $1,405

5 Most Popular Companies:

  1. Farmers Insurance
  2. State Farm
  3. Travelers
  4. USAA
  5. Chubb
Percentage of uninsured drivers in the state Most Common Car Number of collisions per year
13.0% Ford F-150 768

Overview

In Louisiana, the payout after a car accident is determined using the fault system. This means that the driver who caused the collision will be liable for any damages incurred. It also means that medical payments will not be forthcoming until the blame has been assigned in the crash.

Drivers may also share the blame for a collision, though a driver cannot claim damages if they are over 50% responsible for the collision. If a driver is the victim, then their claim will be reduced by the amount of responsibility that they share in causing the accident.

For every offense of driving without a license in Louisiana, the driver will have to bring proof of insurance to the DMV to get their license reinstated. This is accompanied by a scaling fine based on the number of offenses: $100 for the first offense, $250 for the second, and $700 for the next.

Coverage Type Coverage Amount
Bodily Injury $15,000 (per person) / $30,000 (total per accident)
Property Damage $25,000

Maine

Fun fact: In 1911, Maine hosted some of the first official automobile races in the country.

Average insurance rate: $704

5 Most Popular Companies:

  1. Allstate
  2. Nationwide
  3. Progressive Group
  4. Farmers Insurance
  5. Travelers
Percentage of uninsured drivers in the state Most Common Car Number of collisions per year
4.5% Chevrolet Silverado 1500 137

Overview

Since Maine uses the tort system to determine liability after a car accident, drivers will have to wait for the investigation to be completed before they are paid out by insurance. Victims in car accidents will either be able to file a claim with their insurer, a claim with the other driver’s company, or file a lawsuit.

Many victims choose to file lawsuits when the damages caused by the car accident exceed the coverage of the other driver’s policy. Keep in mind that a driver can sue the responsible party whether or not this threshold is reached in Maine and almost any other at fault state.

In Maine, the penalty for driving without insurance can range from $100 to $500, depending on how many times the driver has committed the offense. The license and vehicle registration will also be suspended until the driver can prove that they have sufficient coverage to drive legally.

Coverage Type Coverage Amount
Bodily Injury $50,000 (per person) / $100,000 (total per accident)
Property Damage $25,000

Maryland

Fun fact: The Maryland was a car built in Baltimore from 1907 to 1910.

Average insurance rate: $1,116

5 Most Popular Companies:

  1. Berkshire Hathaway
  2. Farmers Insurance
  3. Progressive Group
  4. State Farm
  5. Allstate
Percentage of uninsured drivers in the state Most Common Car Number of collisions per year
15.2% Honda CR-V 501

Overview

Since Maryland is an at fault auto insurance state, drivers may feel free to file a lawsuit on the responsible party in a collision, provided they are the victim. When a party is found responsible for a crash, their insurance will also have to pay out for the property damage and bodily injury to the victim motorist and their vehicle.

Most of the time, an at fault claim will result in three years of elevated premiums for the responsible driver. Further claims can result in the policy being refused for renewal due to the risk that the driver presents to the insurance company.

Maryland has relatively lax fees for driving without insurance, as they will typically fine you $175. This fee may increase with subsequent offenses. The biggest discouraging factor is that drivers will lose their license plates and vehicle registration until they prove that they are insured.

Coverage Type Coverage Amount
Bodily Injury $30,000 (per person) / $60,000 (total per accident)
Property Damage $15,000

Massachusetts

Fun fact: In 1927, Massachusetts was the first state in the USA, which mandated that drivers require car insurance.

Average insurance rate: $1,129

5 Most Popular Companies:

  1. Farmers Insurance
  2. Nationwide
  3. Berkshire Hathaway
  4. USAA
  5. Progressive Group
Percentage of uninsured drivers in the state Most Common Car Number of collisions per year
6.2% Toyota RAV4 360

Overview

The Massachusetts state law requires all vehicle owners to have a minimum amount of auto insurance and carry proof of insurance at all times. Failure to comply may result in stringent penalties, including hefty monetary fines, from $500-$5000, and jail time. Also, it is important to note that auto-insurance in Massachusetts will pay your injury claims up to a specified limit regardless of who caused the accident (no-fault insurance).

Coverage Type Coverage Amount
Bodily Injury $20,000 (per person) / $40,000 (total per accident)
Property Damage $5,000
Personal Injury Protection $8,000
Uninsured/Underinsured Auto $20,000 (per person) / $40,000 (total per accident)

Michigan

Fun fact: Michigan is the number-one automobile manufacturer out of the 50 states.

Average insurance rate: $1,364

5 Most Popular Companies:

  1. Liberty Mutual
  2. Farmers Insurance
  3. Chubb
  4. State Farm
  5. Travelers
Percentage of uninsured drivers in the state Most Common Car Number of collisions per year
20.3% Ford Escape 974

Overview

Under the Michigan Law (MCL 500.2103), all owners or registrants of vehicles, or those who have a valid Michigan driver’s license are eligible for auto insurance. No-fault insurance is required by law in Michigan, and every car owner must get coverage to get license plates for their vehicles. The no fault insurance will pay for your medical expenses and the damage you have caused to other peoples’ property irrespective of whose fault it was in the accident. The basic no-fault coverage constitutes Personal Injury Protection (PIP), Property Protection (PPI), and Residual Liability Insurance.

Personal Injury Protection (PIP) – This part of the policy will cover all your reasonable medical expenses with no specified maximum limit. It will also reimburse 85% of the income you would have earned if you had not been hurt for up to three years. However, the amount for the lost revenue is subject to annual revision. In addition, you are entitled up to $20 per day in replacement services to pay for routine household services, which the injured persons are no longer able to perform for themselves and their families. Recent reform in the PIP entails that insured persons can enjoy unlimited coverage per person per accident.

Property Protection (PPI) – The no-fault auto-insurance coverage will cover any property damages, such as buildings or fences, the accident might have caused. It will also pay for the damage your car has caused another person’s parked vehicle and does not pay for any other damage to vehicles.

Residual Liability Insurance – The no-fault law protects the insured from being sued from accidents, except in certain situations, which are as follows. A) If you cause an accident in Michigan in which someone is permanently disfigured, seriously injured, or killed. B) If you are involved in an accident in Michigan with a non-resident occupant of a vehicle not registered in Michigan. C) If you are involved in an accident in another state other than Michigan. Furthermore, you can only be sued for up to $1,000 if you are more than 50% at fault in an accident, which has caused damage to another car.

If you want the coverage to cover the damages to your car, you must get collision coverage, which includes – limited collision coverage, standard collision coverage, and broad form collision coverage.

Coverage Type Coverage Amount
Bodily Injury $50,000 (per person) / $100,000 (total per accident)
Property Damage $10,000
Personal Injury Protection $50,000 (total per accident)

Minnesota

Fun fact: Cook County, Minnesota, has one RV registered for every 50 inhabitants.

Average insurance rate: $875

5 Most Popular Companies:

  1. Nationwide
  2. Chubb
  3. State Farm
  4. Berkshire Hathaway
  5. Allstate
Percentage of uninsured drivers in the state Most Common Car Number of collisions per year
11.5% Ford F-150 381

Overview

Minnesota state law requires all vehicle owners to have a minimum amount of auto insurance and carry proof of insurance at all times.

Failure to comply may result in penalties, including fines starting from $200, which, if you are unable to pay, the court may require community service and up to 90 days of jail time. The state adopts no-fault auto insurance, which requires residents and non-residents of Minnesota to maintain basic economic loss benefits and automobile liability coverage, i.e., Personal Injury Protection (PIP), on the vehicles they use. The cars are required to be registered or licensed or principally garaged in Minnesota. The law also requires non-residents of the state to maintain PIP and liability coverage on any other owned vehicle intended to be driven within Minnesota’s borders.

Under Minnesota’s no-fault auto insurance policy, you can claim your household’s medical expenses under the stated limits, medical expenses, replacement services, and lost wages. The costs are paid irrespective of who is at fault. Moreover, $2,000 is covered for funeral expenses in the event of death.

Moreover, no-fault claims are first made on your PIP. If the expenses exceed your PIP limit, you may also claim against the other party’s liability coverage if the other party is liable. It is important to note that the no-fault policy in Minnesota does not apply to motorbikes or snowmobiles. These vehicles require a separate insurance policy that will not include PIP coverage by default but can be purchased separately. It is also important to note that no-fault claims must be made within six months of the accident. The complete application of benefits and proof of expenses is required to file a claim.

Coverage Type Coverage Amount
Bodily Injury $30,000 (per person) / $60,000 (total per accident)
Property Damage $10,000
Personal Injury Protection $20,000 (medical coverage) / $20,000 (loss for income)
Uninsured/Underinsured Motorist $25,000 (per person) / $50,000 (per accident)

Mississippi

Fun fact: In Mississippi, more than 200 car or car component manufacturers employ a workforce of 20 000 people.

Average insurance rate: $994

5 Most Popular Companies:

  1. Liberty Mutual
  2. Progressive Group
  3. Travelers
  4. Berkshire Hathaway
  5. USAA
Percentage of uninsured drivers in the state Most Common Car Number of collisions per year
23.7% Ford F-150 664

Overview

The minimum auto insurance requirements in Mississippi require all drivers in Mississippi to maintain and carry minimum liability insurance, i.e., $25,000 liability coverage for bodily injury or death of one person, $50,000 for total bodily injury or death, and $25,000 for property damage.

These policies come into play when you or your family member is driving a car and gets into an accident. The coverage does not include the at-fault party’s injuries or damage. Moreover, the liability coverage pays for the medical expenses, property damage, and other losses sustained by the driver, passengers, and pedestrians.

Mississippi follows the fault-based system, which stipulates whoever is responsible for the accident bears the financial responsibility for any losses incurred from the accident. This includes accident-related injuries, property damage, lost income, etc.

According to the state’s comparative negligence rule, victims can recover compensation if they are at fault, but their claim amount is reduced depending on their share of negligence. This can be very disputative as there are no specific guidelines on determining fault. It falls on the individual’s shoulder to prove to an adjuster that they did not play a role in causing the accident.

Insurance companies in Mississippi provide option coverage plans to resolve such disputes. These coverages are namely – collision coverage, comprehensive coverage, medical payments, uninsured/underinsured motorist, rental reimbursement, and towing and labor.

Coverage Type Coverage Amount
Bodily Injury $25,000 (per person) / $50,000 (total per accident)
Property Damage $25,000

Missouri

Fun fact: Missouri has nearly 1400 miles of state highway, the 5th most in the USA.

Average insurance rate: $872

5 Most Popular Companies:

  1. Progressive Group
  2. Berkshire Hathaway
  3. Travelers
  4. USAA
  5. Allstate
Percentage of uninsured drivers in the state Most Common Car Number of collisions per year
14% Ford F-150 921

Overview

Missouri law states that license holders must have both liability and uninsured motorist coverage. Liability covers the driver from causing damage or injury or protecting themselves if injured by an uninsured motorist. The latter is a possible problem in Missouri.

The state government reports that approximately fourteen percent of drivers have neither coverage. It’s important to note that Missouri is a comparative fault state. Meaning, you are financially culpable for the degree of damage caused by yourself in an accident.

Coverage Type Coverage Amount
Bodily Injury $25,000 (per person) / $50,000 (total per accident)
Property Damage $10,000
Uninsured Motorist $25,000 (per person) / $50,000 (total per accident)

Montana

Fun fact: 3.7% of Montana’s state workforce is employed in the automotive industry.

Average insurance rate: $864

5 Most Popular Companies:

  1. Farmers Insurance
  2. Chubb
  3. Nationwide
  4. Progressive Group
  5. Travelers
Percentage of uninsured drivers in the state Most Common Car Number of collisions per year
9.9% Ford F-150 182

Overview

Montana offers some of the lowest premiums in the country. Lower premiums might protect you in the event of a simple collision but probably will not suffice in the event of serious injury, accidental death, or massive property damage.

Many Montanans opt to carry extra coverage, as it’s necessary to lease or finance a car in the state. In Montana, it is estimated that between ten to fifteen percent of drivers are uninsured.

The options available include uninsured motorist coverage (UM), which pays your medical costs if injured.

However, underinsured motorist coverage (UIM) ensures that your medical and or funeral costs are covered when the at-fault driver doesn’t have enough Liability insurance. Failure to provide proof of insurance to a police officer is a misdemeanor that, on the third offense, can earn you six months in prison.

Montana is prone to catastrophic weather, such as floods, tornadoes, and intense wildfires, deemed “acts of God.” Many of these unexpected events are covered by collision and comprehensive plans, including theft, vandalism, hail, and riots.

Coverage Type Coverage Amount
Bodily Injury $25,000 (per person) / $50,000 (total per accident)
Property Damage $20,000

Nebraska

Fun fact: Alliance, Nebraska, is home to Carhenge, a replica of Stonehenge made out of vintage cars.

Average insurance rate: $831

5 Most Popular Companies:

  1. Progressive Group
  2. Nationwide
  3. Chubb
  4. Berkshire Hathaway
  5. Allstate
Percentage of uninsured drivers in the state Most Common Car Number of collisions per year
6.8% Ford F-150 228

Overview

Liability and uninsured/underinsured motorist coverage are required in Nebraska. Fortunately, Nebraska has one of the lowest uninsured drivers stats in the nation, 6.8 percent. However, seat belt laws are not enforced in Nebraska, which translates to higher instances of severe injuries and deaths.

Seventy-nine percent of Nebraska’s motorists regularly use seatbelts, compared to the national average of ninety-percent. Carrying extra Liability and UM/UIM coverage is the easiest way to protect yourself from these threats. Nebraska’s geography influences the types of vehicles purchased in the state.

The combined percentage of SUV and pickup trucks sold annually totals around 38.21 percent, close to total car sales, that average around 38.64 percent. SUVs and pickups are more expensive to insure because their size can cause more severe personal injury and property damage, and off-roading increases the chance of damage to the vehicle.

The bulk of Nebraska’s road fatalities are in rural parts of the state, totaling seventy-four percent, compared to twenty-six percent in urban environs. Road conditions are noteworthy since fifty-nine percent of Nebraska’s principal roads are in some form of disrepair. And the state is prone to severe weather events, such as thunderstorms and tornadoes, making it essential to get coverage.

Coverage Type Coverage Amount
Bodily Injury $25,000 (per person) / $50,000 (total per accident)
Property Damage $25,000

Nevada

Fun fact: Drivers in Nevada rack up a total of 30 billion miles per year.

Average insurance rate: $1,103

5 Most Popular Companies:

  1. Berkshire Hathaway
  2. Liberty Mutual
  3. Progressive Group
  4. Travelers
  5. State Farm
Percentage of uninsured drivers in the state Most Common Car Number of collisions per year
10.6% Toyota RAV4 330

Overview

Drivers in the state must have minimum liability insurance. But these minimums are subject to the requirements set by lienholder and car leasing companies. Nevada operates its auto insurance claims via a Tort System. The burden of financial responsibility falls on the individual at-fault. Many insurers and leasing companies require that their clients have coverage that is above the state’s minimum.

According to the data, Nevada’s average premium was the 9th most expensive nationally. Averaging around $1,013 for individuals. An insurance policy that is in good standing will provide you the coverage when you need it, but failure to maintain an insurance policy will make it harder to find coverage when you want to reinstate your insurance, and often at a much higher price.

Nevada also is cracking down on delinquent policies with an insurance authenticity program. In conjunction with state insurance agencies and the DMV, a driver can have their license suspended should this cross-check discover their policy has lapsed. Usually, this takes place between thirty to sixty days of being uninsured. Whether you can reinstate your policy is at the discretion of the insurance company.

Coverage Type Coverage Amount
Bodily Injury $25,000 (per person) / $50,000 (total per accident)
Property Damage $20,000

New Hampshire

Fun fact: Pickup trucks are the most common class of motor vehicle in New Hampshire.

Average insurance rate: $819

5 Most Popular Companies:

  1. Farmers Insurance
  2. Progressive Group
  3. Nationwide
  4. Allstate
  5. USAA
Percentage of uninsured drivers in the state Most Common Car Number of collisions per year
9.9% Chevrolet Silverado 1500 147

Overview

Much like the state’s motto, “Live free or die,” the auto insurance laws in New Hampshire are not as rigid as other states. While auto insurance is not required, the law does require you to cover all costs of property damage and bodily harm if you cause an accident. Even though auto insurance is not mandatory here, it is the best way to cover these costs.

Despite it not being a legal requirement to drive, the number of uninsured drivers is low compared to other states.

The majority of road safety advice is focused on increasing visibility at night and the use of winter tires during the snowy months.

Coverage Type Coverage Amount
Bodily Injury $25,000 (per person) / $50,000 (total per accident)
Property Damage $25,000

New Jersey

Fun fact: It is illegal to idle your car for longer than three minutes in New Jersey.

Average insurance rate: $1,383

5 Most Popular Companies:

  1. Nationwide
  2. Farmers Insurance
  3. State Farm
  4. USAA
  5. Allstate
Percentage of uninsured drivers in the state Most Common Car Number of collisions per year
14.9% Honda CR-V 564

Overview

New Jersey is a state with a no-fault policy, meaning you file injury claims with your provider regardless of who is at fault for the accident. This means you require personal injury protection (PIP), which pays for medical bills like medical equipment and doctors. It could additionally reimburse you for the loss of wages.

However, having uninsured motorist (UM) coverage is mandatory in New Jersey. This means if you get involved in an accident with someone who does not have insurance, your provider will pay your costs and not the other driver’s fee. There are many more coverage options that are important if you live in New Jersey.

For example, you can get flood coverage if you live in flood-prone areas surrounding Pompton Lakes, Little Falls, and Lincoln Park. Depending on which part of New Jersey you live in, you may consider insurance covering the risk of damage to your car from vandalism, hail, fire, falling objects such as rocks, riots, and collisions with animals like deer, among others.

Coverage Type Coverage Amount
Bodily Injury $15,000 (per person) / $30,000 (total per accident)
Property Damage $5,000
Personal Injury Protection $15,000

New Mexico

Fun fact: Vehicles are responsible for 5% of New Mexico’s state tax revenue.

Average insurance rate: $938

Percentage of uninsured drivers in the state Most Common Car Number of collisions per year
20.8% Ford F-150 391

Overview

Motorists in New Mexico must carry liability car insurance as stipulated by law. For this type of insurance coverage, your auto insurance provider pays for property damage and bodily injuries you cause to others in case you are in a car accident.

It also covers your legal fees in case you face a lawsuit due to a car accident. According to the New Mexico Motor Vehicle Division (MVD), if you do not have valid liability insurance, you are subject to your vehicle registration being suspended.

After receiving a Notice of Suspension of Registration letter, you should turn in your license plates and registration to the MVD. You may end up with criminal penalties if you fail to do so.

For those that live in the South Valley, many opt to pick up auto insurance protection against flooding because it is low lying. Equally, they carry pick up coverage to protect themselves in the event of wildfires, which pose the most significant risk during elongated drought periods. Uninsured drivers and wild game can also pose a considerable risk for any motorist in New Jersey.

Coverage Type Coverage Amount
Bodily Injury $25,000 (per person) / $50,000 (total per accident)
Property Damage $10,000

New York

Fun fact: 3% of New York households own three or more cars.

Average insurance rate: $1,361

5 Most Popular Companies:

  1. Progressive Group
  2. Berkshire Hathaway
  3. Allstate
  4. State Farm
  5. USAA
Percentage of uninsured drivers in the state Most Common Car Number of collisions per year
6.1% Nissan Rogue 943

Overview

Getting coverage in New York is paramount whether you drive in New York City or on the outskirts of Lake Ontario. New York State follows a no-fault system in regards to how it assigns liability due to accidents. This means that both parties will benefit from their insurance providers, regardless of who was at fault.

This is done through your Personal Injury Protection coverage, which is a requirement by New York’s state law. It offers benefits such as; death benefits, rehabilitation, and medical expenses, and reimbursement for loss of wages. According to the Consumer Federation of America, car insurance costs have been gradually on the rise in New York for the past two decades.

If you drive in a city like New York, buying only the required car insurance can leave you quite vulnerable should you make even an innocent mistake, such as backing into a pole, or sideswiping on a guardrail.

Also, urban areas like the five boroughs of New York may present dangers to your vehicle even when stationary that may require insurance coverage such as theft or vandalism.

Coverage Type Coverage Amount
Bodily Injury $25,000 – $50,000 (death of person in an accident)
$50,000 – $100,000 (for death of 2+ people per accident)
Property Damage $10,000

North Carolina

Fun fact: Over 460 000 workers are employed in the North Carolina automotive industry.

Average insurance rate: $789

5 Most Popular Companies:

  1. State Farm
  2. Liberty Mutual
  3. Berkshire Hathaway
  4. Allstate
  5. Chubb
Percentage of uninsured drivers in the state Most Common Car Number of collisions per year
6.5% Honda Accord 1,437

Overview

North Carolina is a “fault” state, which means that a driver who is considered to have
caused an accident is held responsible for any resulting damages. It has relatively stringent guidelines, requiring two types of insurance. Liability, which includes injury to the body or damage to property, and uninsured motorists/underinsured motorists (UM/UIM) coverage, which is applicable if the other driver is either uninsured or doesn’t have enough liability insurance to cover expenses incurred by an accident. Every other type of coverage is optional, including, but not limited to, collision coverage (damage to the car through a collision with another vehicle or an object) and comprehensive coverage (damage to the vehicle through vandalism, theft or riots, weather-related damage, or collisions with an animal). Driving without car insurance makes the driver subject to fines and up to 45 days of probation.

North Carolina is one of the least expensive states for automobile insurance. Not only is it a mostly rural state with an aging population, but the insurance commissioner of North Carolina also sets a cap on maximum insurance rates. In terms of weather conditions, North Carolina’s summer thunderstorms, often accompanied by strong winds and hail, pose the most significant economic threat. It is also located in an area of tornado activity and suffers from periodic flash floods. In winter, the possibility of snowstorms is equally worth keeping in mind.

Coverage Type Coverage Amount
Bodily Injury $30,000 (per person) / $60,000 (total per accident)
Property Damage $25,000

North Dakota

Fun fact: Within a year of the North Dakota DMV putting the words “Peace Garden State” on license plates, it was formally adopted as the state’s nickname through legislature.

Average insurance rate: $773

5 Most Popular Companies:

  1. Farmers Insurance
  2. Nationwide
  3. Travelers
  4. Allstate
  5. Berkshire Hathaway
Percentage of uninsured drivers in the state Most Common Car Number of collisions per year
6.8% Ford F-150 105

Overview

North Dakota is one of the few “no-fault” states, which means drivers responsible for the accident are not held financially accountable for damages. Its law requires a type of coverage called basic personal injury protection (PIP), also called basic no-fault, which covers financial losses that result from injury in an accident (for example, medical expenses or lost wages while recovering), regardless of who caused the accident.

North Dakota also requires the purchase of insurance coverage for bodily injury, property damage, and uninsured motorists/underinsured motorists (UM/UIM). Insurance for car damage is optional: collision coverage pays for repairs after a collision with another vehicle or an object, and comprehensive coverage pays for damage caused by weather (floods, hail, fire, falling tree branches), by animals or car theft, vandalism or riots. In North Dakota, driving without car insurance incurs a fine of 150$ or an automatic suspension if the driver is involved in an accident.

North Dakota’s car insurance rates are some of the lowest in the country, thanks to its low population density. However, North Dakota is subject to several potentially dangerous weather manifestations. Its winters are notoriously cold and windy, with frequent blizzards, black ice, and snowstorms, which can make driving hazardous. It is also prone to flooding in spring and tornadoes in summer.

Coverage Type Coverage Amount
Bodily Injury $25,000 (per person) / $50,000 (total per accident)
Property Damage $25,000
Uninsured/Underinsured Motorist $25,000 (per person) / $50,000 (total per accident)

Ohio

Fun fact: The first documented speeding ticket was issued in Dayton, Ohio, for a speed of 12 mph.

Average insurance rate: $789

5 Most Popular Companies:

  1. Chubb
  2. Liberty Mutual
  3. Farmers Insurance
  4. State Farm
  5. Travelers
Percentage of uninsured drivers in the state Most Common Car Number of collisions per year
12.4% Honda Civic 1,068

Overview

Ohio is a “fault” state, so drivers are held financially responsible for any accident they are deemed to have caused. Its minimum requirements for car insurance coverage are liability, namely bodily injury liability and property damage liability.

All other types of coverage are optional. Medical Payments (MedPay) covers medical expenses incurred by the driver or the passengers no matter who’s at fault, and also covers possible funeral expenses. Physical damage coverage protects the car, either as collision, which pays for damage to the car incurred through a collision with another vehicle or an object, or comprehensive, which covers damage caused by weather events, animals, or theft, and vandalism. Coverage for uninsured motorists/underinsured motorists (UM/UIM) is also optional. Driving with no car insurance may result in a suspension of driving privileges.

Ohio is the third cheapest state in terms of car insurance, thanks to the competition between a high number of car insurance carriers offering their services in the area. Ohio’s weather is not particularly dangerous for careful drivers: it has cold, snowy winters with the occasional ice storm. Tornadoes or flooding sometimes happen, but they’re not a frequent occurrence.

Coverage Type Coverage Amount
Bodily Injury $25,000 (per person) / $50,000 (total per accident)
Property Damage $25,000

Oklahoma

Fun fact: The TULSA was a vehicle made in Oklahoma to rival the Ford Model T. Unfortunately, it was too expensive to wrestle the market away from its competitor.

Average insurance rate: $1,005

5 Most Popular Companies:

  1. Progressive Group
  2. Liberty Mutual
  3. State Farm
  4. USAA
  5. Farmers Insurance
Percentage of uninsured drivers in the state Most Common Car Number of collisions per year
10.5% Ford F-150 655

Overview

Oklahoma is a “fault” state, which means that drivers have to be prepared to face financial liability in case of an accident. Its car insurance laws are very similar to Ohio’s, with similar minimum requirements: bodily injury liability and property damage liability.

All other types of coverage (Medical Payments, collision, comprehensive, uninsured motorist/underinsured motorist coverage) are optional. Driving without car insurance in Oklahoma may result in a suspension of driving privileges and a variety of fines.

Oklahoma is one of the more expensive states when it comes to car insurance. While its high percentage of uninsured drivers is partially to blame, it is Oklahoma’s challenging weather that keeps car insurance rates high.

This state is subject to frequent tornadoes and thunderstorms, and there is often property and car damage from large hail. Heavy rains sometimes cause flooding, with repercussions ranging from wet roads causing loss of vehicle control to cars being swept away by floodwater.

Coverage Type Coverage Amount
Bodily Injury $25,000 (per person) / $50,000 (total per accident)
Property Damage $25,000

Oregon

Fun fact: Until 1911, Oregon residents had to provide their own license plates.

Average insurance rate: $905

5 Most Popular Companies:

  1. Berkshire Hathaway
  2. Chubb
  3. State Farm
  4. USAA
  5. Allstate
Percentage of uninsured drivers in the state Most Common Car Number of collisions per year
12.7% Subaru Outback 506

Overview

Since Personal Injury Protection insurance is required by law in Oregon, it counts as a no fault state, as each driver will be paid out for medical bills in any collision. Of course, fault determined afterward may result in one of the insurance companies reimbursing the other for their PIP payout.

Keep in mind that Oregon is not a complete no fault state, as drivers don’t require a financial or a verbal threshold to sue the other driver. If you are the victim in a car accident, then you have the right to file a lawsuit against the responsible motorist regardless.

The minimum fine for driving without auto insurance in Oregon is only $130, but this will only apply when a driver simply forgets their documentation. If you are caught intentionally driving uninsured, then you will be fined up to $1000.

Coverage Type Coverage Amount
Bodily Injury $25,000 (per person) / $50,000 (total per accident)
Property Damage $20,000
Personal Injury Protection $15,000
Uninsured Motorist $25,000 (per person) / $50,000

Pennsylvania

Fun fact: Pennsylvania’s Simeone car collection has been ranked as the best vintage car collection in the world.

Average insurance rate: $971

5 Most Popular Companies:

  1. Progressive Group
  2. State Farm
  3. USAA
  4. Farmers Insurance
  5. Berkshire Hathaway
Percentage of uninsured drivers in the state Most Common Car Number of collisions per year
7.6% Honda CR-V 1,190

Overview

Drivers in Pennsylvania choose between a limited tort system and a full tort system, essentially allowing them to pick between at fault and no fault car insurance. Some drivers prefer the limited tort no fault system, as insurance premiums are more affordable.

Those who opt for the full tort system in Pennsylvania do so because they reserve their right to file a lawsuit after a car accident, which is impossible under the limited tort system.

If you are caught without car insurance in Pennsylvania, then you will be on the hook for a fine of at least $300 after the impounding of your vehicle and the suspension of your license. After your license has been suspended for a period of three months, you may also have to pay a restoration fee of $150.

Coverage Type Coverage Amount
Bodily Injury $15,000 (per person) / $30,000 (total per accident)
Property Damage $5,000

Rhode Island

Fun fact: The Newport Car Museum, located in Portsmouth, has over 72 cars on display.

Average insurance rate: $1,304

5 Most Popular Companies:

  1. State Farm
  2. Berkshire Hathaway
  3. Progressive Group
  4. Travelers
  5. USAA
Percentage of uninsured drivers in the state Most Common Car Number of collisions per year
15.2% Toyota RAV4 59

Overview

Rhode Island uses the at fault system to determine how insurance pays out after a car accident. The three options available to a victim in Rhode Island include filing a claim with their own insurance, filing a claim with the other driver’s insurance, and pursuing a lawsuit against the responsible driver.

Compare this to no fault states, where the victim would otherwise be unable to file a lawsuit for any damages unless they reach a certain threshold. While uninsured motorist coverage isn’t required in Rhode Island, it will have to be declined in writing by the policyholder.

In Rhode Island, the first offense for driving without insurance doesn’t carry as harsh of a penalty, incurring a $500 fine and 3-month license suspension. Subsequent offenses will instead carry a $1000 fine and a license suspension lasting for a year.

Coverage Type Coverage Amount
Bodily Injury $25,000 (per person) / $50,000 (total per accident)
Property Damage $25,000

South Carolina

Fun fact: The BMW plant in South Carolina is the top car exporter in the country measured by dollars.

Average insurance rate: $973

5 Most Popular Companies:

  1. Nationwide
  2. Progressive Group
  3. Berkshire Hathaway
  4. Allstate
  5. State Farm
Percentage of uninsured drivers in the state Most Common Car Number of collisions per year
9.4% Toyota RAV4 1,037

Overview

Drivers in South Carolina are subject to the at fault system, which requires the responsible driver to pay for the damages that they have caused in a collision. This results in slower payouts from insurance companies, as they determine who caused the accident through an investigation.

This also means that the victim in a collision can sue the other driver for damages that they sustained. Due to South Carolina’s modified comparative negligence system, the victim may have their settlement reduced by the percentage of the blame they shared.

Drivers who are caught without insurance in South Carolina will have to pay $5 for every day that their car was uninsured, up to a maximum of $200. They will also be subject to a $550 reinstatement fee after their license and vehicle registration are suspended.

Coverage Type Coverage Amount
Bodily Injury $25,000 (per person) / $50,000 (total per accident)
Property Damage $25,000
Uninsured Motorists $25,000 (per person) / $50,000 (total per accident)

South Dakota

Fun fact: Clark, South Dakota’s Potato Day celebration includes car races.

Average insurance rate: $767

5 Most Popular Companies:

Percentage of uninsured drivers in the state Most Common Car Number of collisions per year
7.7% Ford F-150 130

Overview

South Dakota is a tort state, meaning when there is an accident, whoever is at fault is responsible for damages from both parties. That makes being insured in the state essential.

There are a few things to consider in terms of threats on the road.

South Dakota also has a sizable youth driving population, which can make the roads more dangerous.

In the state, teenagers are eligible for a learner’s permit when they turn 14 years of age. They have to pass a written knowledge and vision test. Permits are valid only for a year, and they must always drive accompanied by somebody who is 18 years of age or older.

Drivers under the age of 25 account for almost a third of the fatal collisions each year, despite being only 16% of the driving population. Beyond that, storms and tornadoes do the most damage, especially in the lower parts of the state, and pose the biggest threat.

Insurance coverage can vary, but the more comprehensive the coverage, the higher the likelihood of protection in the event you are found at fault due to an accident.

Coverage Type Coverage Amount
Bodily Injury $25,000 (per person) / $50,000 (total per accident)
Property Damage $25,000
Uninsured and Underinsured Motorist Coverage (UM/UMI) $25,000 (per person) / $50,000 (total per accident)

Tennessee

Fun fact: Smyrna’s Nissan plant produces the most cars per year in North America, making nearly 650 000 cars in 2016.

Average insurance rate: $871

5 Most Popular Companies:

  1. Berkshire Hathaway
  2. Farmers Insurance
  3. Progressive Group
  4. State Farm
  5. Nationwide
Percentage of uninsured drivers in the state Most Common Car Number of collisions per year
20% Ford F-150 1,041

Overview

Tennessee boasts mountains and mudslides, great music, and rich culture, but to make the most of it, you need a car. The legal system for determining who is responsible for damage in the state follows the “At-Fault” system. This means that whoever is responsible for the damage caused due to an accident is held financially accountable.

Tennessee experiences a wide range of natural disasters, from earthquakes to severe storms, and there is a coverage option for each. Beyond that, Tennessee law requires all drivers to prove they are capable of being financially responsible in the event of an accident. The easiest way to do so is to pick up an auto insurance policy that covers the state’s minimum limits, as outlined below.

Coverage Type Coverage Amount
Bodily Injury $25,000 (per person) / $50,000 (total per accident)
Property Damage $15,000

Texas

Fun fact: Texas drivers drove over 282 billion miles in 2018.

Average insurance rate: $1,110

5 Most Popular Companies:

  1. Farmers Insurance
  2. Nationwide
  3. State Farm
  4. Travelers
  5. USAA
Percentage of uninsured drivers in the state Most Common Car Number of collisions per year
14.1% Ford F-150 3,642

Overview

One of Texas’s many unique aspects is that insurance requirements can vary greatly depending on the city you live in. Insurance requirements and costs for car owners in Houston will be different from those living in Dallas, San Antonio, or Austin due to the geographical makeup, crime rate, and more.

Proof of auto insurance in the state is vital and is required when an individual gets a car inspection, registers a car, completes specific transactions pertaining to their driver’s license, and in case one is pulled over by law enforcement.

The minimum insurance coverage for Texas is;

Property Damage Liability: $25,000
Uninsured Motorist Property Damage: $25,000 and a $250 deductible unless you reject this coverage
Uninsured Motorist Bodily Injury: $30,000 per person and $60,000 per accident unless you reject this coverage
Personal Injury Protection (PIP): $2,500 unless you refuse this coverage.

There are also specific insurance coverage add-ons for those traveling to Mexico because of the proximity of the state with the country’s southern neighbor.

Coverage Type Coverage Amount
Bodily Injury $30,000 (per person) / $60,000 (total per accident)
Property Damage $25,000

Utah

Fun fact: Salt Lake City’s Classic Cars Museum contains over 100 rare vehicles.

Average insurance rate: $873

5 Most Popular Companies:

  1. Berkshire Hathaway
  2. Farmers Insurance
  3. Nationwide
  4. Progressive Group
  5. State Farm
Percentage of uninsured drivers in the state Most Common Car Number of collisions per year
8.2% Ford F-150 260

Overview

Whether you’re taking in the sights or tearing up the slopes, Utah has a lot to offer. But, due to its mountainous geography, Utah can be tricky to navigate for novice drivers.

With mudslides, snowstorms, and more making things even harder, it makes sense why the coverage minimums are what they are. Utah has fewer accidents than other states due to how its population is distributed/operates but has higher fatality rates in the event of an accident.

In Utah, all drivers must carry proof of insurance with them and be able to present it to a law enforcement agent upon request. It is important to know that underinsured or uninsured covers can be rejected in writing as well as the ‘loss of income’ portion of PIP coverage.

Uninsured Motorist: $25,000 per person and $65,000 per accident
Personal Injury Protection: $3,000 per accident
Underinsured Motorist: $25,000 per person and $65,000 per accident

Coverage Type Coverage Amount
Bodily Injury $25,000 (per person) / $65,000 (total per accident)
Property Damage $15,000

Vermont

Fun fact: Back in 1905, Vermont had over 15 000 miles of highways.

Average insurance rate: $764

5 Most Popular Companies:

  1. Liberty Mutual
  2. Berkshire Hathaway
  3. Allstate
  4. State Farm
  5. USAA
Percentage of uninsured drivers in the state Most Common Car Number of collisions per year
6.8% Toyota RAV4 68

Overview

Vermont uses a comparative fault system, technically making them an at fault state. This means that a driver will only be able to claim damages from an accident if they share 49% of the blame or less for an accident, though they can have their settlement reduced in some cases.

A victim can have their payout reduced by the percentage of the responsibility that they share for an accident in Vermont. For example, if the responsible party only shares 80% of the blame, the victim’s damages will be cut by that remaining 20% to make up for what they did to cause the accident.

Vermont’s first and second offenses for driving without insurance are relatively light, with a $100 fee, though this is only for failing to provide proof. If you are found to be driving without insurance, you may be subject to a fine of an extra $500 as well as three years of an SR22 CFR.

Coverage Type Coverage Amount
Bodily Injury $25,000 (per person) / $50,000 (total per accident)
Property Damage $10,000
Uninsured/Underinsured Motorist Coverage $50,000 (per person) / $100,000 (total per accident)

Virginia

Fun fact: Gary Duncan of Christiansburg, Virginia, has a collection of over 1400 vehicles.

Average insurance rate: $843

5 Most Popular Companies:

  1. Progressive Group
  2. Berkshire Hathaway
  3. Allstate
  4. Nationwide
  5. Farmers Insurance
Percentage of uninsured drivers in the state Most Common Car Number of collisions per year
9.9% Honda CRV 820

Overview

Virginia is one of the only two states in America that doesn’t have mandatory auto insurance coverage, as drivers in this state can pay the UMV (Uninsured Motor Vehicle) fee instead. For $500 a year, you are allowed to operate your car without insurance.

However, since this option doesn’t provide coverage, most drivers prefer to pay a little more for insurance so that they won’t have to pay out if they’re liable for an accident. Despite insurance not being mandatory, there are still penalties for drivers who forego both insurance and the UMV fee.

Neglecting to either get your car insured or pay this fee counts a class 3 misdemeanor that will remain on your record. It is also punishable by a fine of up to $500, ensuring that drivers are more likely to pay the fee if they decide to drive without insurance.

Coverage Type Coverage Amount
Bodily Injury $25,000 (per person) / $50,000 (total per accident)
Property Damage $20,000

Washington

Fun fact: Opened in 2012, the Tacoma Car Museum is now home to over 350 vehicles.

Average insurance rate: $969

5 Most Popular Companies:

  1. Berkshire Hathaway
  2. Chubb
  3. Liberty Mutual
  4. State Farm
  5. Travelers
Percentage of uninsured drivers in the state Most Common Car Number of collisions per year
17.4% Subaru Outback 546

Overview

Washington requires by law that you have liability coverage for your vehicle. This means that each driver is adequately protected if the incident is not their fault. The minimum insurance will cover the bodily injury or death of another party and cover property damage. Washington differs from other states in that they provide more than one form of coverage. In the case of an accident, your options are self-insurance, liability bond, or a certificate of deposit.

Self-insurance

Self-insurance applies if you have 26 vehicles or more, and requires a certificate with your issued self-insurance certificate number.

Certificate of deposit

A certificate of deposit is a deposit of at least $60,000 or collateral of at least the same value. This can be set up through a Washington State bank or office. The regulations are similar to auto-insurance and self-insurance; you must have proof of this certificate.

Liability bond

A liability bond abides by the same rules as a certificate of deposit. It requires a bond, filed by a surety bond company, for $60,000.

You may not need to worry about coverage in Washington if you’re driving one of the following:

-Motorcycle
-Moped
-Horseless-carriage (over 40 years old)
-State-owned vehicle

Coverage Type Coverage Amount
Bodily Injury $25,000 (per person) / $50,000 (total per accident)
Property Damage $15,000

West Virginia

Fun fact: The Norwalk Motor Car was the closest West Virginia ever got to automotive industry success. The vehicle was made from 1912 to 1922.

Average insurance rate: $1,026

5 Most Popular Companies:

  1. State Farm
  2. Nationwide
  3. Farmers Insurance
  4. Berkshire Hathaway
  5. Allstate
Percentage of uninsured drivers in the state Most Common Car Number of collisions per year
9.9% Chevrolet Silverado 1500 294

Overview

West-Virginia uses a tort system. This means that a driver when deemed at fault, must pay for the damages they have caused by not driving responsibly. These damages include all medical expenses and lost wages due to recovery time from the injury.

Proof of fault

Negligence laws require proof that the negligence occurred. Evidence that a driver disobeyed a traffic law can be helpful when proving fault. For instance, skid marks made by the vehicle could be used to indicate that the driver was speeding.

Presumed fault

In some cases, the fault is presumed, such as in the event of a car being rear-ended. The damage from behind the vehicle is evidence enough in many situations to decide that they were not at fault.

Liability

To pay these expenses as the result of an accident, drivers must carry liability insurance at all times in their vehicles. Failure to do so could result in a 30-day driving suspension, going up to 90-days if you’re caught a second time.

Coverage Type Coverage Amount
Bodily Injury $25,000 (per person) / $50,000 (total per accident)
Property Damage $25,000
Uninsured Motorist $25,000 (per person) / $50,000 (total per accident)

Wisconsin

Fun fact: The first horseless carriage powered by steam was made by a pastor in Racine, Wisconsin, back in 1873.

Average insurance rate: $737

5 Most Popular Companies:

  1. Liberty Mutual
  2. Berkshire Hathaway
  3. Chubb
  4. Travelers
  5. USAA
Percentage of uninsured drivers in the state Most Common Car Number of collisions per year
14.3% Chevrolet Silverado 1500 588

Overview

Auto insurance in Wisconsin is set up to deal with a variety of incidents. Fatal crashes are most prevalent in the late summer to early winter months. There is snow, deer, and storms that, when coupled with most Wisconsin’s predilection for speeding, lead to a majority of the auto-related deaths in the state, especially when alcohol is involved.

Like West-Virginia, Wisconsin is also a tort state. Wisconsin is a traditional “fault-state,” meaning that if a driver is found to be at fault, it is their responsibility to pay for the damages. These damages include injury, property damage, as well as lost income due to injury from the accident. If you find yourself in this situation, here are your options.

File a claim

If you have been injured in a car accident, you can file a claim with your insurance company, provided that your provider covers the incident.

File a third-party claim

With a third party claim, you are making a claim through the other driver’s provider. You will need to start with your attorney. Your attorney will contact the at-fault driver’s insurance company and begin the process of filing a claim. There are also options for sending a letter to the provider, or in some cases, this can be done online.

File a personal injury lawsuit

To do this, you would need to take the incident to civil court. This begins by filing documents with the court, to then be served to the driver at fault.

Coverage Type Coverage Amount
Bodily Injury $25,000 (per person) / $50,000 (total per accident)
Property Damage $10,000

Wyoming

Fun fact: Laramie’s Elmer Lovejoy was the creator of power steering.

Average insurance rate: $847

5 Most Popular Companies:

  1. Farmers Insurance
  2. Nationwide
  3. Progressive Group
  4. State Farm
  5. USAA
Percentage of uninsured drivers in the state Most Common Car Number of collisions per year
7.8% Ford F-150 111

Overview

Wyoming is a “fault state” when it comes to auto accident responsibility. It is an at-fault driver’s responsibility to pay for any costs associated with injury and damage caused by the accident through their liability coverage. In Wyoming, this includes injury to any passengers in the vehicle, as well as injury to pedestrians. Liability coverage will also include an accident in which a family member was driving your car.

Uninsured/Underinsured

If you are injured in an accident by an uninsured driver, uninsured motorist insurance will cover your medical bills. Although this insurance is not mandatory in Wyoming, by law, it must be offered to you. If you decline, you must do so in writing.

Comprehensive

Comprehensive coverage is also not mandatory but will provide you with coverage in the event of non-accident related damage. For instance, if your vehicle is stolen, you’ll be provided with coverage. You will also be covered in the event of damage due to hail, fire, and even vandalism.

Medical payments coverage

Medical payments coverage or MPC is another optional form of coverage. In collisions in which you and your passengers are injured, you will be covered for the medical costs. This is a beneficial option for those without health insurance.

Coverage Type Coverage Amount
Bodily Injury $25,000 (per person) / $50,000 (total per accident)
Property Damage $20,000

Conclusion

a peice of paper on wall with text are you covered?

Driving a two-ton piece of metal down the highway at 60 mph is not without its risks, and that’s the exact reason why car insurance exists and is mandated by nearly all states. The potential for damage (both bodily and to property) while driving a car is far higher than anything else most people do in their daily lives.

Whether a driver is looking for the cheapest minimum coverage that will allow them to drive or a complete policy that will cover all sources of damage, finding the right policy takes knowledge. Understanding the details of car insurance will allow drivers to ensure that they are getting their money’s worth out of a policy.

Ideally, this guide has helped you select the ideal car insurance coverage for your needs. Stay safe out on the road.

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