Auto Insurance: Arizona's Requirements

Arizona requires all drivers to have car insurance. The state has specific minimum coverage requirements, and drivers must carry proof of insurance when driving. The minimum coverage limits are $25,000 for bodily injury or death of one person in an accident, $50,000 for two or more people, and $15,000 for property damage. These requirements are in place to ensure that drivers are financially protected in the event of an accident.

Minimum auto insurance requirements in Arizona

Arizona requires that every motor vehicle on the road be covered by a car insurance policy that meets certain minimum requirements. Arizona drivers are required to have proof of financial responsibility when operating a motor vehicle on Arizona roadways. Most drivers demonstrate their financial responsibility by buying an auto insurance policy.

The state requires a minimum coverage limit for each of the following:

• Bodily injury liability coverage: Minimum $25,000 per person / $50,000 per accident
• Property damage liability coverage: Minimum $15,000
• Uninsured motorist bodily injury coverage: Minimum $25,000 per person / $50,000 per accident
• Underinsured motorist bodily injury coverage: Minimum $25,000 per person / $50,000 per accident

These minimum coverage limits are often referred to as 25/50/15. This is known as a split limit as it lists the limits of three separate coverage types: per person, per accident, and property damage.

The per-person limit refers to the amount that will cover any single person injured in an accident you cause. It will cover multiple people up to the per-accident limit. The per-accident limit applies if you injure more than one person in the same accident. It is the total amount that your insurance company will cover for bodily injuries you cause in any one accident. This limit is the total amount that your insurer will pay, though never paying over the per-person limit for any one person.

Property damage per accident is the total dollar amount that an insurance company will cover for damages to another's property caused by you.

While liability insurance covers what you would owe to another driver, you may still have significant costs for your own medical care and car repairs. Most agents and government officials recommend getting more than the mandatory insurance limits in Arizona.

Proof of financial responsibility

Arizona requires all drivers to carry a minimum amount of car insurance and to be able to provide proof of financial responsibility. This can be demonstrated by purchasing an auto insurance policy, which must be carried by the driver at all times. This is to ensure that drivers can cover the costs of damages and injuries to others in the event of an accident.

The state requires a minimum coverage limit of $25,000 for one person sustaining bodily injury or death in an accident, $50,000 for two or more people, and $15,000 for damage to others' property. These minimum requirements are often referred to as 25/50/15 coverage.

If a driver chooses not to purchase car insurance, they can still prove financial responsibility by making a $40,000 deposit and obtaining a certificate from the Arizona Office of Treasurer validating the deposit.

Failure to provide proof of financial responsibility when requested by a law enforcement officer can result in civil penalties and the suspension of driving privileges. Drivers may be fined up to $1,000 and have their driver's license, registration, and license plates suspended for up to a year for a first offense. The penalties increase for subsequent offenses within a 36-month period, with fines reaching $1,000 and suspension periods extending to a year for a third offense.

To reinstate driving privileges after a violation, drivers must pay fees, provide proof of financial responsibility, and may be required to obtain an SR-22 certificate of financial responsibility for up to three years.

Penalties for driving without insurance

Arizona has strict penalties for driving without insurance. The penalties vary depending on the number of prior incidents of driving without insurance on the driver's record. Here is a breakdown of the penalties for driving without insurance in Arizona:

First Offense

For a first offense, drivers will face a fine of $500 and a suspension of their driver's license, registration, and license plates for three months. To reinstate these privileges, drivers will need to pay a $35 fee, a $10 reinstatement fee, and a $10-$25 application fee. Additionally, drivers may be required to file an SR-22 certificate for two or three years, which can lead to higher insurance rates.

Second Offense

For a second offense within three years of the first, the fine increases to $750, and the suspension period for the driver's license, registration, and license plates is extended to six months. The same fees as the first offense apply for reinstatement. Drivers may also be required to file an SR-22 certificate for two or three years.

Third and Subsequent Offenses

For a third offense within three years of two or more previous violations, the fine increases to $1,000, and the driver's license, registration, and license plates will be suspended for one year. The same fees as the previous offenses apply for reinstatement, and drivers will likely be required to file an SR-22 certificate for three years.

It is important to note that the SR-22 certificate is a requirement imposed by the state of Arizona. It serves as proof of financial responsibility and indicates that the driver has acquired and maintains the minimum required amount of automobile insurance. Obtaining an SR-22 certificate may result in higher insurance rates, as insurers consider SR-22 holders as high-risk drivers.

Recommended insurance coverage

Arizona requires that every motor vehicle operated on its roadways be covered by one of the statutory forms of financial responsibility, more commonly called liability insurance. This requirement also includes golf carts, motorcycles and mopeds.

The minimum levels of financial responsibility are:

• $25,000 for one person sustaining bodily injury or death in an accident
• $50,000 for two or more persons sustaining bodily injury or death in an accident
• $15,000 for damage to others' property

However, there is no guarantee that the minimum amount of coverage will offer enough financial protection in the event of an accident. If a driver with minimum coverage causes an accident and their passengers' injuries exceed $100,000, they would have to pay the remaining amount out of pocket. Therefore, it is recommended that drivers purchase more coverage than the minimum required amount to protect themselves financially in case of a serious crash.

In addition, an optional but recommended type of coverage in Arizona is uninsured/underinsured motorist insurance. It replaces the liability coverage an at-fault driver should have and pays for your costs up to your policy limits. Uninsured/underinsured motorist coverage financially protects the insured in an accident if the other driver does not have insurance or does not have enough insurance to cover any losses they caused.

Collision coverage, which is part of full coverage auto policies, pays to repair vehicle damages after an accident. Comprehensive coverage, also part of full coverage, covers the vehicle for damages not caused by an accident, such as falling objects, flooding, and theft.

Alternative proof of financial responsibility

Arizona requires that every motor vehicle on the road be covered by a car insurance policy that meets certain minimum requirements. However, there is an alternative to purchasing car insurance.

The Arizona Motor Vehicle Division (MVD) allows drivers to satisfy the financial responsibility law by making a deposit of $40,000 in either cash or securities (such as government bonds or notes) with the state treasurer. Once the treasurer has verified that the driver has no prior unsatisfied judgments against them, they will receive a certificate of deposit. This certificate can be used as proof of insurance when pulled over by law enforcement. However, if a driver with only a certificate is at fault in an accident, the claims will be paid out of their deposit. If the total amount of the claims exceeds $40,000, the driver is at risk of being sued by the injured party for the remaining amount.

It is important to note that driving without the minimum required insurance in Arizona is illegal and has steep consequences. For a first offense, drivers will be fined $500 and their license and registration will be suspended for three months. For a second offense within three years, the fine increases to a minimum of $750, and the license, registration, and license plates will be suspended for six months. For three or more offenses within three years, the fine is a minimum of $1,000, and the driver's license, registration, and license plates will be suspended for one year.

Frequently asked questions