Tennessee Auto Insurance: Is It Mandatory?

Tennessee requires all drivers to carry a minimum level of car insurance. If you are caught driving without insurance in Tennessee, you may have to pay a fine, surrender your driver's license and registration, or even face jail time.

The minimum insurance requirements in Tennessee are:

- $25,000 bodily injury liability per person

- $50,000 bodily injury liability per accident

- $15,000 property damage liability per accident

Minimum auto insurance requirements in Tennessee

Tennessee requires all drivers to have some form of financial responsibility in order to drive. The most common way to meet this requirement is by having car insurance with at least the minimum coverage limits.

The minimum liability coverage in Tennessee is 25/50/15, which means:

• $25,000 bodily injury liability per person and $50,000 per accident
• $15,000 property damage liability per accident

Bodily injury liability insurance covers the other party's medical bills and necessary treatments, such as ambulance services, surgeries, and rehabilitative services. Property damage liability insurance covers the cost of property damage, typically the other driver's car repair costs, but also damage to buildings or fences, for example.

While liability coverage is the only insurance required by the state of Tennessee, a bank or lien holder could require you to carry extra coverage if your vehicle is being financed (usually comprehensive and collision).

You'll also need to carry proof of coverage, such as an insurance ID card or a copy of your policy declaration page, at all times when driving. If you're caught driving without insurance, you may have to pay a fine or surrender your driver's license.

Tennessee insurance companies are required to include uninsured motorist coverage in every auto insurance quote. Uninsured motorist bodily injury coverage pays for your medical bills if you're in an accident with an uninsured driver, regardless of who is at fault. Uninsured motorist property damage coverage is also available in Tennessee and pays for your car's repair expenses following an accident with an uninsured or underinsured driver.

Proof of financial responsibility

In Tennessee, drivers must provide proof of financial responsibility, which can be demonstrated in several ways. The most common way to meet this requirement is by carrying car insurance with minimum coverage limits: $25,000 for bodily injury liability per person and $50,000 per accident, as well as $15,000 for property damage. Tennessee drivers must carry proof of coverage, such as an insurance ID card, at all times when driving. Failure to provide proof of insurance when requested can result in fines and the loss of driving privileges.

Tennessee's Financial Responsibility Law requires vehicle owners to show proof of their ability to cover financial losses resulting from any car accident they may cause. This law can be complied with by purchasing liability car insurance coverage, which covers the medical and property damage bills of those injured or whose vehicles are damaged in an accident caused by the policyholder. This type of insurance does not cover damage to the policyholder's property or their own injuries.

In addition to purchasing liability insurance, Tennessee vehicle owners can also demonstrate financial responsibility by posting a cash deposit or bond in the required amount or by qualifying as a "self-insurer" under state law. The required amount for a cash deposit or surety bond is $60,000, which acts as an insurance fund to cover any judgments arising from an auto accident caused by the driver. A surety bond must be issued by a surety company licensed in Tennessee and be valid for at least one year.

Tennessee has strict penalties for drivers who fail to comply with the Financial Responsibility Law. If a driver is unable to demonstrate proof of financial responsibility, they may face a conviction of a Class C misdemeanor, punishable by a fine of up to $300. Additionally, their vehicle may be towed, and their driver's license may be suspended. These penalties are in addition to any financial consequences resulting from a car accident.

Penalties for driving without insurance

Tennessee requires all drivers to carry a minimum amount of car insurance. If you are caught driving without insurance, you could face serious consequences, including fines, the loss of your driving privileges, and even jail time. Here are the penalties for driving without insurance in Tennessee:

Penalties for Failure to Provide Proof of Insurance:

If you are pulled over by a law enforcement officer, they may ask to see your insurance card. If you cannot show proof of insurance, you may be charged with a Class C misdemeanour, punishable by a fine of $300. The officer also has the discretion to have your vehicle towed. To get your driver's license and registration back, you will need to provide proof of insurance, pay a $65 restoration fee, and pay a $50 fee for an SR-22 form. Your insurer will need to file this form on your behalf, and it will remain on file for three years. During this time, your insurance rates may increase as you are considered a high-risk driver.

If you are caught driving without insurance in Tennessee, you may have to pay fines, surrender your driver's license and registration, or even serve jail time. The specific penalties depend on whether you have prior convictions for driving without insurance. For a first offence, you may be fined, have your driver's license and registration suspended, and be required to retake the driver's license exam. For subsequent offences, the penalties will be more severe.

If you are involved in an accident while driving without insurance, the penalties can be even more severe. In addition to the penalties for driving without insurance, you may be required to pay out-of-pocket for any injuries or damage caused in the accident. Tennessee is an at-fault state, meaning the person deemed at fault in an accident is responsible for paying all costs. You could also face a Class A misdemeanour, punishable by up to $2,500 in fines and up to 11 months and 29 days in jail.

Notifying the Department of Revenue:

Tennessee actively monitors whether vehicles are insured. If your vehicle is not insured, the Tennessee Department of Revenue will send you a notice requesting insurance verification within 30 days. If you fail to respond and provide proof of insurance, you will be subject to penalties.

It is important to note that the minimum insurance requirements in Tennessee may not cover all damages in an accident. Many insurance experts recommend purchasing additional coverage to protect yourself financially.

Uninsured motorist coverage

Tennessee has one of the highest numbers of uninsured drivers in the country, with about 20% of all drivers uninsured. This means that for every five cars you pass on the road, one does not have insurance. Tennessee law requires drivers to carry liability coverage, and proof of insurance must be carried at all times when driving. However, individuals have the right to opt out of uninsured motorist coverage (UM coverage) if they choose to.

UM coverage is important for protecting drivers from those without insurance or with inadequate insurance. It also provides coverage for hit-and-runs when certain requirements are met. Tennessee insurance companies are required to include UM coverage in every auto insurance quote. While you can reject UM coverage, most agents and government officials recommend keeping it.

There are two types of UM coverage: uninsured motorist bodily injury (UMBI) and uninsured motorist property damage (UMPD). UMBI covers your medical bills if you're in an accident with an uninsured driver, regardless of who is at fault. It also covers you if the other driver has insurance but their liability insurance is less than your bodily injury limits. UMPD, which is available in only a few states, covers your car repair expenses following an accident with an uninsured or underinsured driver. There may be a deductible, typically $200, for each accident before UMPD covers the remaining bill.

If you're unclear whether you have UM coverage, call your car insurance provider to review your coverage and request it if you need to.

Collision and comprehensive insurance

While liability coverage is the only insurance required by the state of Tennessee, collision and comprehensive insurance are important additions to your auto insurance policy. Collision coverage pays to repair your vehicle if you collide with another driver or object (excluding animals). This includes repairs or a full replacement of your covered vehicle. The average cost of collision coverage is about $290 per year, and it reimburses you for the costs of repairing your car, minus the deductible. Collision coverage also covers damage caused by potholes.

Comprehensive coverage, on the other hand, pays for the repair of non-collision damages to your vehicle. This includes perils like theft, damage from weather, and collisions with animals. It covers damages to the vehicle caused by contact with animals, natural disasters such as earthquakes, floods, hurricanes, tornadoes, and volcanic eruptions, theft of the entire car or parts of the car, and fallen objects such as trees, branches, ice, or projectiles. Comprehensive coverage costs significantly less than collision coverage, with an average total of just over $134 per year.

Together, comprehensive and collision coverage are often referred to as "full coverage." While these coverages are optional in Tennessee, they are highly recommended. If your vehicle is being financed, a bank or lien holder could require you to carry this extra coverage.

Frequently asked questions