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Yes, you’re legally required to have car insurance before driving your or another person’s car in most states. That’s because most states require a minimum level of car insurance to protect you and others from paying out of pocket for car accident damage.
Some states like Arizona and Alabama let you forgo car insurance if you deposit money in a state fund or bond that’s used to cover an accident. But these deposits can be as high as $50,000 — higher than what’s typical for car insurance.
Bodily injury and property damage liability insurance is nearly always required because they protect other drivers and pedestrians in an accident, but not your own life and property. Each state also lists a coverage limit, like $25,000 for property damage liability.
This liability coverage ranges from $30 to 80 a month, depending on factors like your location, car and driving record. Several states also require personal injury protection to pay your medical bills, lost income and other expenses, and uninsured or underinsured motorist coverage if the at-fault driver can’t pay for the damage.
Every state sets different penalties if you drive without car insurance, and these can vary wildly. Some states give out sky-high fines and license suspensions from the first violation, while others start with small fines. These fines and costs easily cost the same or more than your state’s minimum car insurance.
If you’re caught driving without insurance, you may be facing:
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If you’re at fault in the accident, you’re held responsible for damage or injuries that you cause to other people. Without insurance, the other driver may even sue you to get payment from your other financial assets like your savings, investments or your home, assuming you don’t live in one of the 12 no-fault states — like Florida or Kentucky.
That means you’ll be on the hook to pay out of pocket for:
If the other driver caused the accident, you may get reimbursed for your damage and injuries by filing a claim with the at-fault driver’s car insurance. However, if you live in a “no pay, no play” state, you’ll be limited from suing for some damage like emotional stress or physical pain.
If you sue for property damage, you’ll probably pay a high deductible first. These states include Alaska, California, Indiana, Iowa, Kansas, Louisiana, Michigan, Missouri, North Dakota, New Jersey, Oklahoma and Oregon.
Technically, yes in most cases. If you borrow someone’s car, their insurance should pay for any damage to their car and liability for you and others on the road.
However, if you borrow the car regularly or take extended trips, that person’s car insurance may not cover any damage. You’ll be liable for damage and injuries that happen in this scenario, and going without your own insurance would be considered driving uninsured.
A simple nonowner car insurance policy could work well if you need to borrow a car regularly. This policy pays for bodily injury or property damage liability if you get in an accident while driving someone else’s car.
If you’re having trouble paying your car insurance premiums, you have several options:
The cheapest car insurance policy covers your state minimum requirements for liability insurance. Compare the cheapest policies to avoid paying uninsured fines.
Driving with no insurance comes with steep fines, and you could be responsible for liability damage if you get in a car accident. Rather than going without coverage, try shopping around for low-cost car insurance or consider cheap options to help you stay insured.
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