Question

Is it illegal to not have car insurance?

Yes, it is illegal not to have car insurance if you are a car owner.

Not having liability-only insurance is illegal in every US state except New Hampshire, but this law is applicable only to car owners. The car owners have to ensure that their basic insurance complies with the coverage mandated by the state they belong to.

Why is it illegal not to have car insurance?

Any car running on the road poses a certain risk to both the passengers and those around. Therefore, in the event of an accident, financial loss is certain for all affected. During such a situation, the indemnity claim(s) for bodily injury or property damage can be higher than the at-fault driver/owner can afford. Therefore, to avoid the financial struggle, especially for the victims, the states made it illegal for car owners not to have car insurance.

What are the essential insurance coverages needed to own a car?

The most essential insurance coverage you need to own a car is liability coverage, or state minimum insurance. This is the minimum insurance coverage you must possess to drive or own a car. Each state has mandated a certain minimum coverage limit for both private and commercial cars.

The liability-only or state minimum insurance covers the financial loss due to bodily injury and property damage to third parties.