Auto Insurance Requirements
for Alaska Drivers

Minimum car insurance coverage requirements in Alaska and other auto insurance basics

Alaska (like most states) requires drivers to maintain a certain amount of liability insurance.

Despite the requirement, roughly 16 percent of drivers in Alaska are uninsured.

In this article, we’ll take a look at the specific car insurance requirements in Alaska, including the steps you should take if you’re involved in a car accident with an uninsured driver.

Alaska auto insurance requirements for drivers

Alaska’s minimum liability insurance requirements can be found in Alaska Statute 28.22.101.

The minimum amounts to comply with the statute are as follows:

• $50,000 for injuries or death to another person
• $100,000 for injuries or death to all other people (if multiple people are injured or killed in the accident)
• $25,000 for damage to another person’s property

This insurance coverage is commonly referred to as 50/100/25 coverage.

Liability insurance is not required in areas of Alaska where vehicle registration is not required. You can find a complete list of these areas on the Alaska Department of Administration Division of Motor Vehicles website.

Penalties for driving without the minimum auto insurance coverage in Alaska

According to the Insurance Information Institute, more than 16 percent of drivers in Alaska are uninsured.

Driving without insurance in Alaska is risky for three reasons.

First, uninsured drivers are subject to:

• A fine of up to $500 (for a first offense),
• License suspension (90 days to 1 year) and reinstatement fees, and
• Vehicle impoundment

Second, uninsured drivers who cause an accident are personally liable for all of the damages that result. This means that if you cause an accident that results in $1 million of damages, you’ll be legally responsible for paying every penny. If you don’t have the money in your checking account,  the court can garnish your future wages and sell your assets.

Third, Alaska is one of only a handful of states to adopt a “no pay, no play” law. This law prohibits uninsured motorists from collecting compensation for noneconomic damages (pain and suffering, loss of consortium, etc.).

Here’s an example to help you better understand Alaska’s law:

Optional car insurance coverage in Alaska

The minimum liability insurance required may not be enough to cover a serious car accident, leaving you personally liable for the amount of damages that exceed your policy limits. For this reason, many people choose to purchase additional liability insurance.

In addition to more liability insurance, drivers in Alaska have the option to purchase the following coverage:

• Comprehensive coverage provides coverage for losses other than those caused by a collision (vandalism, falling objects, fire, etc.)
• Collision coverage provides coverage for damage to your vehicle caused by an accident with another vehicle or an object (such as a building)
• Personal injury protection (PIP) provides up to $10,000 coverage regardless of who’s at fault (what’s covered depends on the specific policy)
• MedPay provides coverage for medical expenses incurred by you and your passengers, regardless of who is at fault.
• Uninsured motorist (UM) coverage provides coverage for bodily injury and property damage sustained by you or the passengers in your vehicle as a result of an accident involving an uninsured driver.
• Underinsured motorist (UIM) coverage provides coverage for bodily injury and property damage sustained by you or the passengers in your vehicle as a result of an accident involving a driver who has insufficient insurance to cover the damages.
• Rental reimbursement coverage reimburses you for the cost of a rental car if your vehicle is disabled after a covered loss.
• Towing coverage (sometimes called “roadside assistance”) pays for the cost of towing your vehicle to a repair shop.

All policies are not created equal. A comprehensive coverage policy from one insurance provider may exclude damages caused by weather (such as hail or lightning), whereas a comprehensive coverage policy from another insurance provider may cover damages caused by weather. It’s important to read the full policy closely to make sure it provides the coverage you want.

What happens if a friend borrows your car?

Liability insurance follows the vehicle in Alaska, not the person. In other words, if you let someone borrow your car and they cause an accident, your insurance will pay for the damages sustained by the other driver and their passengers.

If the damages exceed your policy limits, the car insurance policy of the person who borrowed your car may provide secondary coverage (i.e., cover the difference between your policy limits and the damages sustained).

Just like liability insurance, collision and comprehensive insurance follow the vehicle in Alaska. PIP and MedPay, on the other hand, follow the driver.

How to pursue damages after a car accident in Alaska

Alaska follows a fault-based system. This means that the person responsible for causing a car accident is also responsible for paying the damages. 

If you’re involved in an accident that’s not your fault, you have 3 options for recovering damages:

1. You can file an insurance claim with your own insurance company (in this situation, your insurance company will pursue reimbursement from the at-fault driver’s insurance company)
2. You can file a third-party insurance claim directly with the at-fault driver’s insurance company, or
3. You can file a personal injury lawsuit in civil court against the at-fault driver.

Unfortunately, if the driver who caused your accident is uninsured, your only option is to file a personal injury lawsuit against the driver for any amount that exceeds your uninsured motorist coverage (if you have it).

If you cause a car accident (i.e., you’re at fault for the accident), you can expect 1 of 3 things to happen:

1. The injured driver will file an insurance claim with your insurance company
2. The injured driver will file an insurance claim with their own insurance company (in this situation, their insurance company will seek reimbursement from your insurance company)
3. The injured driver will file a personal lawsuit against you in civil court (in this situation, your insurance company is legally obligated to retain a lawyer to defend you, assuming that the accident might be covered by your insurance)

Your rights under Alaska’s Unfair Claims Practices Act

An insurance policy is a contract between you and your insurance company. In exchange for a monthly premium, your insurance company agrees to provide the coverage set forth in your policy.

To ensure that you receive the benefit of your bargain with the insurance company, Alaska passed the Alaska Unfair Claims Practices Act (AUCPA).

AUCPA makes it illegal for your insurance company to unreasonably deny your insurance claim or engage in any unfair practices, which include things like:

• Misrepresenting pertinent facts or insurance policy provisions
• Failing to acknowledge and act reasonably promptly after a claim is filed
• Failing to promptly investigate a claim
• Refusing a claim without conducting a reasonable investigation
• Failing to affirm or deny a claim within a reasonable time
• Forcing the insured to initiate or submit to litigation by offering substantially less than the amount ultimately recovered in litigation

If your insurance company behaves unfairly, you have the right to sue them in court for bad faith.

Still have questions about car insurance? These resources may help:

• Can a demand payment letter keep your dispute out of court?
• Dealing with insurance claims adjusters
• Tactics insurance adjusters may use
• Steps to an insurance claim settlement
• Personal property damage in an auto accident
• Maximum medical improvement and your claim
• All about Independent Medical Exams (IMEs)