Car insurance isn’t mandatory in two states: Virginia and New Hampshire. If you live in either of these states, do you need to purchase an auto insurance policy anyway? Let’s break it down.
Virginians can pay an uninsured motor vehicle fee to the State. In New Hampshire, you have the option to post cash bonds. In either of these states, vehicle owners must either get approved to waive insurance requirements or pay a fee. So even though car insurance isn’t mandatory, it might make sense to get a policy to protect you financially. Virginia and New Hampshire are at-fault states. If you’re in an accident, the person who caused the accident should be able to prove financial responsibility up to a certain amount for the other driver’s injury and property damage costs.
In Virginia, this means you can either buy traditional car insurance, prove that you’ll be able to cover the cost of an accident or pay a $500 Uninsured Motor Vehicle Fee (UMF) to the State when you register at the Virginia DMV. You should note that the UMF isn’t car insurance. It only waives your requirements for purchasing minimum requirements from a provider, and you must renew the fee every time you renew your registration. Even if you pay the $500 UMF, you’re still financially responsible if you cause an accident.
In New Hampshire, a vehicle owner can receive approval to waive insurance. If you have had DUIs or have caused accidents while without car insurance in the last three years, you’re less likely to get approved. However, if you are denied approval, you can contact the Bureau of Financial Responsibility to appeal.
If you decide to buy traditional car insurance in either Virginia or New Hampshire, your policy will have to follow a set of prescribed minimums. In Virginia, skipping both the $500 fee and insurance encompasses having to prove financial responsibility by an executed surety bond, cash or security bond, or by self-insurance, which requires owning a lot of cars. In New Hampshire, it gets stickier. You are only required to prove financial responsibility after you cause an accident. If you can’t meet the cash requirements or surety bond, the State suspends your license and registration.
