Auto Insurance Requirements: North Carolina's Essential Guide

North Carolina requires drivers to carry a minimum amount of auto insurance. This includes liability insurance, which covers the other driver's car repair and medical bills if you are found legally responsible for an accident. North Carolina drivers must also have uninsured motorist coverage, which protects you if an uninsured driver causes an accident resulting in injury. Additionally, drivers in North Carolina are legally required to carry their insurance ID card with them at all times when driving.

Liability insurance requirements

North Carolina requires drivers to carry a minimum amount of liability insurance. This includes bodily injury liability coverage and property damage liability coverage. The minimum legal requirements for bodily injury coverage are $30,000 per person and $60,000 per accident. For property damage liability coverage, the minimum legal requirement is $25,000 per accident.

Liability insurance helps pay for other drivers' medical expenses and property damage if you cause an accident. It is important to note that liability insurance does not cover your own vehicle damage or injuries. If you want protection for yourself and your vehicle, you need to add full coverage to your policy.

North Carolina also requires drivers to carry uninsured/underinsured motorist coverage. This includes uninsured/underinsured motorist bodily injury coverage and uninsured motorist property damage coverage. The minimum requirements for uninsured/underinsured motorist bodily injury coverage are $30,000 per person and $60,000 per accident. For uninsured motorist property damage coverage, the minimum legal requirement is $25,000 per accident.

Uninsured/underinsured motorist coverage protects you if you are in an accident with a driver who does not have enough insurance to cover the damage or injuries they caused. In 2022, about 10.3% of North Carolina drivers did not have insurance, so this coverage is important for protecting yourself financially.

It is worth noting that minimum coverage may not be sufficient to cover all expenses in the event of a serious accident. For example, if you cause an accident and the other driver has $80,000 in medical bills, your minimum coverage insurance would only pay $30,000, leaving you responsible for the remaining $50,000. Therefore, it is generally recommended to purchase coverage above the state's minimum requirements to ensure more comprehensive protection.

Uninsured motorist coverage

In North Carolina, drivers are required to carry a minimum amount of uninsured motorist coverage. This includes uninsured motorist bodily injury (UMBI) coverage of at least $30,000 per person and $60,000 per accident, and uninsured motorist property damage (UMPD) coverage of at least $25,000 per accident. UMBI coverage pays for the medical bills of the policyholder and their passengers injured in an accident with an uninsured motorist, while UMPD coverage pays to repair or replace the policyholder's vehicle.

In North Carolina, uninsured motorist insurance usually covers the following situations:

• Accidents caused by a motorist who does not have liability insurance.
• Accidents caused by a driver whose insurance company denies liability.
• Accidents caused by a motorist whose insurance company has become bankrupt.
• Accidents caused by a motorist who drove an uninsured vehicle despite having insurance.

It's important to note that even if a motor vehicle accident falls into one of these categories, an insurance company may still deny the claim.

Underinsured motorist coverage

North Carolina requires drivers to carry underinsured motorist coverage. This type of insurance covers the difference in insurance coverage when the at-fault driver's liability insurance is insufficient to cover the injured party's costs.

Under North Carolina law, drivers must carry the following minimum amounts of coverage:

• Bodily injury liability coverage: $30,000 per person and $60,000 per accident
• Uninsured motorist bodily injury: $30,000 per person and $60,000 per accident
• Uninsured/Underinsured motorist property damage: $25,000
• Property damage liability coverage: $25,000

It's important to note that underinsured motorist coverage is different from uninsured motorist coverage, which protects you when the at-fault driver has no insurance at all. While both types of coverage are required in North Carolina, underinsured motorist coverage has lower minimum requirements.

When purchasing car insurance in North Carolina, it's essential to understand the different types of coverage available and choose a policy that provides adequate protection. While the state mandates minimum coverage requirements, purchasing higher amounts of coverage can provide additional financial protection in the event of an accident.

Additionally, it's worth noting that insurance companies are for-profit businesses and may deny claims to protect their bottom line. As such, it's advisable to consult an experienced attorney when filing a claim to ensure you receive the full compensation you are entitled to.

Proof of insurance

North Carolina requires drivers to carry proof of insurance documentation in their vehicles at all times and to present it upon request by law enforcement. The following documents are acceptable forms of proof of insurance:

• Policy documents
• A certificate of insurance (FS-1)
• A DL-123 insurance form
• Digital insurance information is not accepted

North Carolina drivers are also legally obligated to carry their insurance ID cards with them while driving at all times. If a law enforcement officer asks to see their ID card, they are required to present it. The following specific documents are required:

• DL-123 certification from an insurance agent
• A copy of your policy declaration page
• An insurance binder copy

If a driver's insurance policy is canceled or their coverage lapses, the North Carolina DMV will send a notification to the vehicle owner. The driver then has 10 days to respond with proof of insurance. Failure to do so can result in the DMV revoking the vehicle's license plates, and the driver will be subject to fines and restoration fees.

Penalties for driving without insurance

Driving without insurance in North Carolina is considered a Class 1 misdemeanour and can result in several penalties. The state requires all insurers to notify the DMV if a driver's policy lapses, so it is easy to get caught.

If you are caught driving without insurance, North Carolina assesses fines ranging from $50 to $200. The severity of the punishment increases with each offence.

First Offence

If it is your first offence, you will pay a $50 civil penalty fee and may be put on probation for up to 45 days. The state will suspend your registration and license plates for 30 days unless you submit proof of insurance and pay a $50 reinstatement fee.

Second Offence

If you have two offences within three years, the civil penalty increases to $100. The state will take your registration and license plates for 30 days until you buy insurance and pay the $50 reinstatement fee. You may also face jail time or probation for up to 45 days.

Third and Subsequent Offences

When you get a third offence within three years, the civil penalty fine increases to $150. You also lose your registration and license plates for 30 days until you get insurance and pay the $50 reinstatement fee. You may face jail time or probation for up to 45 days.

Frequently asked questions