Rachael Brennan has been working in the insurance industry since 2006 when she began working as a licensed insurance representative for 21st Century Insurance, during which time she earned her Property and Casualty license in all 50 states. After several years she expanded her insurance expertise, earning her license in Health and AD&D insurance as well. She has worked for small health in...

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Jeffrey Johnson is a legal writer with a focus on personal injury. He has worked on personal injury and sovereign immunity litigation in addition to experience in family, estate, and criminal law. He earned a J.D. from the University of Baltimore and has worked in legal offices and non-profits in Maryland, Texas, and North Carolina. He has also earned an MFA in screenwriting from Chapman Univer...

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Reviewed by Jeffrey Johnson
Insurance Lawyer

UPDATED: Jul 14, 2021

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In a nutshell...

  • Car insurance is required by law in almost every state
  • If you are caught driving without insurance, you risk high fees, possible criminal charges, and liability to other drivers or passengers in the event of an accident
  • The cost of monthly premiums is far less than the long-term costs of an accident if you are not insured

Car insurance is something people think about every month. The reason is that it is one more item on their budget that they have to worry about.

Some people even consider dropping their auto insurance so that they can save a few bucks each month.

Others may ride uncovered for a few days or weeks, telling themselves that they will get coverage again when they can afford it.

This article is for those who wonder why they have to have car insurance. Most of the time, people who ask this question have never had an accident.

Enter your zip code above and answer some basic questions to compare quotes for FREE!

Why is car insurance required?

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The reason auto insurance is required goes back to some of the history of insurance.

Insurance came about in 1885 when the amount of cars sold to individuals rose and more people started driving.

As the number of cars on the road increased, so did the number of accidents. It’s just a matter of statistics playing out.

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Reasons to Carry Auto Insurance

Besides the statistical reasons insurance was invented, there are some valid reasons why you need insurance, even if you are in one of the states that do not require it.

Here is a list of the valid reasons as to why you need insurance:

  • Carrying auto insurance guarantees that you are covered for liabilities and personal injury in the event of an accident
  • Insurance covers repairs for your car so that you can have it repaired following an accident
  • It protects your investment if you recently purchased a new car.
  • It keeps your financial situation secure
  • It lowers the chances of a civil lawsuit

To check to see if your state requires car insurance, check out this site.

It features a state site map that allows you to go to your state insurance website to check for requirements and more information that may be helpful for you in the state in which you live.

You Could Face Stiff Fees and Fines

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Since insurance is required in every state but two, failure to carry the minimum liability and personal insurance can cost you stiff penalties and fees.

In most states, the fee for a first offense is around $200 on average, but it may be closer to $500 in some states.

Check your state fee limits to see where your state stands on this law.

You Could be Cited with a State Crime

In addition to facing stiff fines for failure to carry insurance, you could also face criminal charges.

This document from the state of Alabama outlines the criminal penalties inherent in the failure to carry proper insurance in their state.

If you are convicted of a crime for failure to carry proper insurance, you risk losing your license as well, either temporarily or permanently.

It is vital that you know the laws in your state so that you can work with an attorney if you are faced with this situation.

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Obtaining Insurance in the Future

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One of the liability issues from an insurance provider’s view is your level of risk to them. If you failed to carry insurance, even for one day, you are considered a risk.

If nothing happens on that one day that you do not have coverage, it may be no big deal.

However, if that is the day that you are involved in an accident, DUI, or serious traffic violation, you could have a lot of trouble getting insurance in the future.

This is not only because you had an accident, but because your failure to adhere to the basic law on carrying auto coverage was not honored. Therefore, you are seen as a high-risk customer.

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You Could be Sued by Injured Parties

One of the main reasons insurance was invented in the first place was to cover costs of personal injury, liability, and damage to another person’s property without having to go to court.

If you do not have insurance, the other party is fully justified in suing you for the damages, loss, or liability you caused.

Even if it is not your fault and the other motorists did not carry insurance, you will have to pay for an accident even when it was the other motorist’s fault.

By carrying uninsured and underinsured motorists insurance, this problem can be avoided.

You Could be in Serious Financial Distress

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Because of the possible legal fees, expenses involved in an accident that you must cover yourself, and possible litigation from the other party, even one car accident could cost you a fortune.

If you are stopped in a routine traffic check, you may be cited for failure to carry proper insurance, even if there is no accident involved.

Either way, it can cost you far beyond any expense you have in paying a monthly premium.

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Your Reputation Could be Damaged

Carrying insurance is a basic responsibility of every citizen. In states that do not require it, it is still a sign of maturity and responsibility to carry adequate coverage.

It provides a way for you to get your car repaired or replaced if your car is severely damaged in an accident, whether it is your fault or not.

If you are cited with a crime for failure to carry insurance in a state that requires it, you could have a criminal record.

This could hurt your chances of obtaining the job you want, create problems getting insurance or credit in the future, and create a sense of distrust in some of the people you deal with.

In short, carrying insurance is just something you should do as a responsible adult. It protects you, other drivers, and the people riding in the car with you.

It helps you feel secure that, even if you have an accident, it will be taken care of.

Comparing Insurance Plans

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We’ve given several reasons as to why you should carry insurance. Feel free to ask your online representative for more information, if you choose.

If you are currently not covered by car insurance, why not take that important step today to ensure yourself, your passengers, and your car for the unforeseen events?

Even if no accident occurs the day that you buckle up, you were protected from possible death or debilitating injury by buckling up.

Don’t risk losing your license due to one day of a lapsed policy. Check our site for information and browse the various companies to see what you need.

Enter your zip code below to start comparing FREE online quotes today!