MORE LIKE THISTypes of Auto InsuranceAuto Insurance
Car insurance can be expensive, especially if you pay for coverage you might not need or can’t easily afford. So in some situations, it might make sense to stick with liability-only car insurance — if your state allows you to.
If you cause an accident, your liability-only car insurance pays for other people’s injuries or property damage. But it won’t pay for your medical bills, injuries to immediate family members in your car or damage to your own vehicle after an accident that you caused.
🤓Nerdy Tip
Liability-only car insurance is sometimes called “minimum coverage,” but they aren’t quite the same thing. While many states allow you to purchase liability-only auto insurance, most states require additional coverage types to legally drive. Check out NerdWallet’s minimum car insurance requirements to see what’s required in your state.
See what you could save on car insurance
Easily compare personalized rates to see how much switching car insurance could save you.
on NerdWallet
What does liability-only car insurance cover?
“Liability” is just another word for responsibility — and when it comes to car insurance, that means financial responsibility to cover expenses resulting from an accident.
In other words, if you cause an accident while driving, you’re legally responsible for paying medical bills, lost wages and more for injured drivers, their passengers, and nearby pedestrians. You’re also on the hook to repair or replace any property you damage, like another car, a mailbox or a guard rail.
If you don’t have liability coverage, you’re responsible for paying these bills out of pocket. Medical bills can easily climb into the tens of thousands of dollars, which can add up when you also have to pay for your own medical bills or repair costs. That’s why every state requires at least some amount of liability car insurance (with the exceptions of Virginia and rural parts of Alaska) — or proof you have enough cash on the side to pay for such worst-case scenarios.
Liability-only auto insurance is broken down into two parts:
Bodily injury liability pays for injuries you cause others in a wreck, except your immediate household family members.
Property damage liability pays for any damage you cause to someone else’s property, such as vehicles, fences, buildings and government-owned property.
🤓Nerdy Tip
Liability-only car insurance comes with limits, which are the maximum amount your insurer will pay to cover costs for injuries or property damage you cause. Most states’ minimum requirements are very low, so paying for higher coverage limits can help offset some of the financial risks of driving with liability-only insurance.
» MORE: Liability insurance definitions for 5 common coverage types
What does liability-only car insurance cost?
Most states require residents to have liability-only car insurance to drive. However, the amount of required coverage can vary by state, and you may be required to have more than just liability-only insurance on your policy. So, to avoid any confusion, we’ll use the term “minimum coverage” when talking about costs.
According to NerdWallet’s February 2024 rate analysis, the national average car insurance cost per year for minimum required coverage is:
$549 for a good driver with good credit.
$817 for a driver with an at-fault accident and good credit.
$866 for a good driver with poor credit.
$1,045 for a driver with a recent DUI and good credit.
Why you can trust NerdWallet’s rates
Our writers and editors follow strict editorial guidelines to ensure fairness and accuracy in our writing and data analyses. You can trust the prices we show you because our data analysts take rigorous measures to eliminate outliers and inaccuracies in pricing data, which include rates from every ZIP code in the country where coverage is offered and data is available. When comparing rates for different coverage amounts, ages and backgrounds, we change only one variable at a time, so you can easily see how each factor affects pricing. Read our methodology.
Many factors affect the cost of your insurance policy. Yes, your driving history and insurance provider play a part, but so do where you live, your age and even (in most states) your credit history.
To give you a better idea of how much you might pay for car insurance with the lowest limits possible (either minimum coverage or liability-only auto insurance, depending on what your state requires), refer to the two tables below, or check out NerdWallet’s list of the cheapest car insurance companies.
These rates reflect average costs for a 35-year old driving a 2021 Toyota Camry L with good credit and a clean driving history.
Average annual cost of minimum car insurance from large companies
Company | Average annual rate | Average monthly rate |
|---|---|---|
State Farm | $471 | $39 |
Geico | $491 | $41 |
Travelers | $520 | $43 |
Nationwide | $785 | $65 |
USAA* | $362 | $30 |
*USAA auto insurance is available only to military, veterans and their families. | ||
Cheapest minimum car insurance rates by state
State | Cheapest company | Average annual rate |
|---|---|---|
Alabama | Auto-Owners | $343 |
Alaska | Allstate | $316 |
Arizona | Noblr | $274 |
Arkansas | State Farm | $324 |
California | Geico | $239 |
Colorado | American National | $185 |
Connecticut | Allstate | $618 |
Delaware | Travelers | $674 |
Florida | Geico | $322 |
Georgia | Georgia Farm Bureau | $415 |
Hawaii | Geico | $278 |
Idaho | American National | $134 |
Illinois | Auto-Owners | $335 |
Indiana | Auto-Owners | $261 |
Iowa | Hastings Mutual | $188 |
Kansas | Farm Bureau Financial Services | $341 |
Kentucky | Kentucky Farm Bureau | $222 |
Louisiana | Southern Farm Bureau | $476 |
Maine | Patriot Insurance | $349 |
Maryland | Geico | $522 |
Massachusetts | Vermont Mutual | $263 |
Michigan | Wolverine Mutual | $248 |
Minnesota | Farm Bureau Financial Services | $332 |
Mississippi | State Farm | $330 |
Missouri | Missouri Farm Bureau | $323 |
Montana | State Farm | $181 |
Nebraska | American National | $120 |
Nevada | State Farm | $460 |
New Hampshire | The Hanover | $228 |
New Jersey | State Farm | $357 |
New Mexico | Progressive | $323 |
New York | NYCM | $380 |
North Carolina | Erie | $364 |
North Dakota | Nodak | $325 |
Ohio | Buckeye | $221 |
Oklahoma | American Farmers & Ranchers | $275 |
Oregon | CIG | $537 |
Pennsylvania | Erie | $295 |
Rhode Island | Quincy Mutual | $519 |
South Carolina | American National | $215 |
South Dakota | North Star | $242 |
Tennessee | Progressive | $274 |
Texas | State Farm | $372 |
Utah | QBE | $414 |
Vermont | Union Mutual | $193 |
Virginia | Virginia Farm Bureau | $376 |
Washington | Pemco | $222 |
Washington, D.C. | Chubb | $319 |
West Virginia | Westfield | $415 |
Wisconsin | Integrity | $166 |
Wyoming | American National | $132 |
🤓Nerdy Tip
Just because the average cost of minimum car insurance from one company is listed as the cheapest in your state doesn’t necessarily mean it’ll be the cheapest option for you. A car insurance premium from one company can vary dramatically from person to person — that’s why we recommend shopping around with at least three different insurers when looking for the best rates.
Is liability-only auto insurance right for me?
Liability-only car insurance isn’t right for everyone, but it can be a helpful option for some drivers in particular circ*mstances.
Here are a few cases where liability-only auto insurance might make sense:
You can’t afford more than the bare minimum car insurance your state requires. If this is because of a spotty driving record, be sure to get quotes from specialty insurers — they focus on providing auto insurance to high-risk drivers.
You own a car that’s not worth much and you don’t mind paying out of pocket to repair or replace it. You also have good health insurance and don’t typically have passengers riding with you, as either of these could increase your financial liability after an accident.
You rarely drive, and you keep your car stored safely.
You don’t drive at all but want to avoid a lapse in coverage.
Here are some examples of when liability-only auto insurance might not make sense:
You live in a state that requires more than liability-only coverage, so insurers can’t legally sell liability-only car insurance to you.
You lease or finance your car. Most lenders require full coverage car insurance, which includes multiple types of coverage.
You can afford more than your state’s minimum requirements. Remember, accidents are expensive and misfortune can strike at any time. Other coverage types like personal injury protection and uninsured/underinsured motorist coverage can help cover things like medical expenses and lost wages for you and your passengers after an accident.
» MORE: How much car insurance do you really need?
See what you could save on car insurance
Easily compare personalized rates to see how much switching car insurance could save you.
on NerdWallet
Frequently asked questions
Is liability-only car insurance the same as minimum coverage?
Not quite. Most states require residents to have more than liability-only car insurance, such as personal injury protection and uninsured motorist coverage. “Minimum coverage” means the bare minimum insurance coverage and limits required to legally drive in your state, whether that is liability-only coverage or other coverage types too.
What’s the difference between liability-only insurance and full coverage?
Full coverage car insurance is a combination of coverage types, including liability, collision and comprehensive coverage, and sometimes others as well. It will cost more than liability-only car insurance because it covers a wider range of scenarios.
What if I don’t own a car?
If you don’t have your own car but drive a friend’s or family member’s, you may be covered by their insurance policy. In addition, if you frequently use a car-sharing service, rent cars or want to maintain continuous coverage, you can also explore non-owner car insurance.
