I heard I don’t need Auto Insurance Coverage in Florida—is that true?

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Reader’s question:

I heard I don’t need Auto Insurance Coverage in Florida—is that true?

-Chad

Like all rumors Chad, this one is partly true, but mostly not.

Almost every state in the United States requires some degree of car insurance, but Florida is one of the states which requires the least amount of car insurance. Florida state law requires any would-be driver to purchase personal injury protection—known as PIP—and property damage liability (PDL). The minimum amount of insurance you can purchase is $10,000 PIP and $10,000 PDL. If you are looking for a car (cheap) insurance quote, Florida is probably the best place to go when it comes to paying very little premium.

However, there are conditions. If you don’t have very many assets—if you only make a small amount of money, for example, then the Florida Department of Motor Vehicles requires you to purchase more coverage. That seems like it wouldn’t make much sense—those that want to pay the least in car insurance are probably those who have the least amount to pay—but it’s to make sure that you can actually pay for the damage you cause (if any).

As far as optional car insurance, Florida state prohibits an insurance company from forcing you to buy additional coverage. But if you had to take a loan out to pay for your vehicle, the bank that lent you the money may insist you get additional insurance in order to receive a loan.

Nothing in this world is as easy as it looks, is it Chad?

GLJ