Minnesota Auto Insurance Basics


When you register your vehicle in the state of Minnesota, you must be able to prove that you have established financial responsibility by purchasing insurance for your automobile. Each state requires proof of financial responsibility but some offer alternative methods such as posting a secured bond or putting up a certificate of deposit with the state treasurer. Minnesota requires coverage through a state approved insurance agency.

While the basic levels of auto insurance coverage is pretty much the same in every state, it is the type of coverage and amount of liability insurance required that is what is different. The amount of your deductibles and the level of coverage you choose will all have a bearing on how much you will pay for the premiums on your automobile insurance. If you are unable to get insurance because you are a high risk, the state has a program that will help you get coverage without having to pay exorbitant rates

The basic levels of liability coverage for automobiles breaks down into Bodily Injury, Property Damage, Personal Injury Protection, Collision, Comprehensive, Uninsured Motorist, and Underinsured Motorist coverage.

In the state of Minnesota you must carry liability insurance, personal injury protection underinsured motorist coverage and uninsured motorist coverage. The levels that are mandated by the Minnesota insurance commissioner represent the highest amount that your insurer will pay out for each accident. You may want to go over these requirements and make decisions as to whether to increase these levels or supplement your policy with additional coverage.

Liability coverage also known as bodily injury will cover the medical bills and lost wages for the person or people who were in the vehicle that you hit. It does not cover your medical bills or those of family members or passengers who were in your car at the time of the accident. Personal injury protection covers those costs as well as any medical bills you might incur if you were hit by a car as a pedestrian.

Property damage protection will pay for the repair of the vehicle that you hit if you were at least partially at fault, as well as replacement of the vehicle including any personal items that may have been in the car at the time of the accident if that vehicle is determined beyond repair and is totaled.

Collision coverage is what will pay the expenses to repair or replace your car that was damaged in an accident. The collision coverage will only replace the cash value of your automobile at the time of the accident. Some people owe more on their vehicle than it is worth. You may want to ask about gap insurance which covers the difference between what you owe on the vehicle and what your insurer is going to pay you to replace it.

Comprehensive coverage is liability protection that pays for damages to your car that were the result of anything but an accident with another vehicle. Some examples are theft, flood, fire, vandalism or an accident involving an animal, such as hitting a deer. If you have a new vehicle, a leased vehicle or if your car is financed you may want to seriously consider this coverage.

Uninsured Motorist coverage and Underinsured Motorist coverage are mandatory in the state of Minnesota. Uninsured Motorist coverage will pay your expenses if your vehicle is hit by someone who has no insurance coverage at all while Underinsured Motorist coverage will protect you if you were hit by a driver who didn’t have enough coverage to pay for your expenses.

If you aren’t sure exactly what you need to properly cover yourself and your family members, talk to an insurance professional and he or she will guide you through it.