Do you actually need car insurance?
Asked by: Jackson Olson | Last update: October 23, 2025Score: 4.2/5 (18 votes)
Is car insurance really necessary?
By requiring car insurance in almost every state, U.S. car insurance laws help financially protect individuals in the event they cause or are involved in an accident. These laws attempt to ensure that every driver has insurance to cover a minimum level of costs for injuries and property damage they're responsible for.
Is it okay to not buy car insurance?
Normal? No - It's extremely unwise to not have car insurance. Even if one is wealthy and can afford to self-insure, such an individual would be putting oneself in great danger of a large lawsuit that could wipe out much of their money. Very few people drive without insurance which makes it far from normal.
At what point is car insurance not worth it?
If your vehicle is paid off, there are only a few instances that justify dropping collision coverage: Your vehicle's value is less than a few thousand dollars: If your car holds minimal value, collision coverage may not be worth carrying. This is especially true when a large car insurance deductible is involved.
Is it legal to not have car insurance in the US?
Car insurance is mandatory in almost every state. State minimums and coverage types vary, but nearly all states that mandate insurance require liability coverage for property damage and bodily injury.
How much car insurance do I actually need?
How long can you go without car insurance?
It is a crime to drive almost anywhere without car insurance coverage, even for a minute or just down the street. So, how long can you be without car insurance? If you're driving, you can't. Anytime you get behind the wheel as a licensed driver, you need insurance coverage or you'll risk incurring major consequences.
When did car insurance become a thing?
The International Risk Management Institute reports that automotive fire and theft insurance first became available in 1902. In 1912, the precursor to today's multi-line auto insurance plans was developing, as insurance companies began combining property, liability and fire coverage for cars into one policy.
Is it better to not go through car insurance?
Always file a claim if there are injuries.
“While there are occasional situations where a claim isn't needed, sometimes going through your insurance is unavoidable, such as when someone is injured or when fault is unclear. If the damage is only to your vehicle, however, it's up to you.”
When should you drop full coverage insurance on your car?
For example, you might want to drop comprehensive coverage if: You park your car in the garage and protect it from animals, falling objects, and severe weather. You plan to replace your car next time it needs big repairs. Your car is worth less than the deductible on your comprehensive coverage.
At what age car insurance goes down?
The most substantial reductions in auto insurance rates typically come as teen drivers get older, usually when they hit 18 or 19 years old. Rates continue to decline as you age, particularly once drivers pass the age of 25.
Why would someone not have car insurance?
By far the most cited reason for not having auto insurance is the cost, a trend that rose dramatically in recent years with the Great Recession. While people still needed their car to go to work or haul groceries, many decided that they could save money by cutting out their car insurance premiums.
What happens if I don't buy insurance?
You're more likely to receive several penalties, including a fine, having your car impounded, and getting your license suspended until you can provide proof of insurance.
Should I have insurance if I don't have a car?
If you don't own a car but still drive, a liability-only policy might make sense for you. This type of policy is much less expensive than standard personal auto insurance and will protect your assets from legal, medical and remediation expenses you owe to others.
Is it OK not to buy car insurance?
Authorities can charge you with legal offenses if an officer finds that you can't provide insurance upon their request after a speeding incident or a car accident. Stuart Winchester, CEO of the insurance shopping startup Marble, says your vehicle could be impounded, which is common in states including California.
What state does not require car insurance?
New Hampshire and Virginia are the only states that do not require auto insurance. However, if you choose not to purchase car insurance in these states, you would still be held liable for any property damage or bodily injury caused by their vehicle. Do you live in an at-fault or not-at-fault state?
Is insurance really needed?
Insurance is an important financial tool. It can help you live life with fewer worries knowing you'll receive financial assistance after a disaster or accident, helping you recover faster.
Is it good to keep full coverage on a paid-off car?
Risk Tolerance: Full coverage can provide peace of mind by protecting your car from various risks, including accidents, theft, and weather damage. If you prefer the extra security, keeping full coverage might be worth it, even after the car is paid off.
What happens if I don't put full coverage on my car?
Having only the minimum liability required by your state with no additional coverage leaves a large gap when it comes to repairing your vehicle after an accident.
Can I drop car insurance anytime?
Yes, you can kick your car insurance to the curb whenever your heart pleases. However, if you're switching companies, the best time to cancel is after you've found new insurance coverage.
Is it OK to cancel car insurance?
There's nothing to stop you cancelling your car insurance if you pay monthly. Just tell your insurance provider that you want to cancel and they'll arrange it for you. You'll probably have to pay a fee, which may be described as an administration, arrangement, processing or cancellation fee by your insurance provider.
What happens if you don't tell your insurance about an accident?
There is no California law per se about notifying your insurance company after a collision, but your auto insurance policy is a contract. When you signed it, you agreed to the stipulations in the contract, which will almost certainly include the requirement to notify the insurance company promptly after an accident.
What happens if I don't insure my car?
Authorities can charge you with legal offenses if an officer finds that you can't provide insurance upon their request after a speeding incident or a car accident. Stuart Winchester, CEO of the insurance shopping startup Marble, says your vehicle could be impounded, which is common in states including California.
Why are we forced to have car insurance?
Since your vehicle has the potential to cause physical or material harm, you need to carry enough insurance to cover the costs of these damages. To legally register and drive your vehicle, you need to maintain at least your state's minimum level of liability insurance.
Why is car insurance mandatory?
Having car insurance is required by law in most states. If you are at fault in a car accident, the auto liability coverage required on your car insurance policy helps pay for covered losses, such as the other party's medical bills and damage to their vehicle or other property that results from the accident.
When did not having car insurance become illegal?
In 1956, New York passed a law requiring car insurance for all state residents. The following year, North Carolina followed suit. By the 1970s, every state had a motor vehicle financial responsibility law in place — and only a few states, like New Hampshire, offered a loophole for safe drivers to drive insurance-free.