Navigating the Old Dominion State’s unusual car insurance laws
According to the Virginia Department of Transportation, there are roughly 5.9 million licensed drivers in the state of Virginia. Letting these drivers traverse the winding Virginia roads without auto insurance would seem like a recipe for disaster. Nevertheless, Virginia is one of the few states in the country that doesn’t require its drivers to carry liability insurance.
What does this mean for you and your auto accident claim?
We’ll break it all down right here.
Fault-based insurance system
No-fault and fault-based insurance systems refer to a state’s rules for how a car accident victim is required to handle the claims-filing process.
- No-fault insurance systems. In states with a no-fault insurance system, all drivers in an accident—no matter who’s responsible—turn to their own insurance policies to cover the damages.
- Fault-based insurance systems. In states with a fault-based insurance system, the person responsible for causing a car accident is responsible for paying the damages.
Virginia has a fault-based insurance system. Consequently, the person who is responsible for causing a car accident is financially responsible for the resulting damages.
Is auto insurance required in Virginia?
You are NOT required to carry liability insurance in Virginia if you pay a $500 uninsured motor vehicle fee (UMVF) to the Virginia Department of Motor Vehicles. Once this fee is paid, you are free to drive a vehicle in the state uninsured for 12 months (at which point you’ll need to pay another fee). However, if you cause an accident, you’ll be personally liable for whatever damages result.
Drivers who prefer to carry liability insurance don’t have to pay the $500 fee so long as the liability insurance they purchase meets the following minimum coverage amounts:
- $25,000 for the bodily injury or death of one person in an accident
- $50,000 for total bodily injury or death in an accident (i.e., for all persons harmed in one accident)
- $20,000 for property damage per accident
The amounts listed above are the minimum requirements. You always have the option to purchase more coverage. Keep in mind that you’ll be personally liable for the damages incurred above your policy limits. So, the more coverage you have, the less likely it is you’ll be forced to pay for someone else’s damages out of your own pocket should you cause a crash.
Virginia law prohibits an auto insurance company from refusing to issue a policy solely for 1 of the following reasons:
- Because you have been refused auto insurance by another company
- Because you once purchased insurance through the assigned risk plan
- Because of your age, sex, residence, race, color, creed, national origin, ancestry, marital status, or lawful occupation
If you are refused auto insurance for one of the reasons listed above, the insurance company is acting illegally and you should contact an attorney.
If you are refused auto insurance for some other reason (such as a long history of accidents), you should contact the Virginia Automobile Insurance Plan to obtain coverage through the state.
Penalties for driving uninsured in Virginia
If you drive uninsured and have not paid the $500 UMVF, your driver’s license and registration will be suspended.
In addition, you’ll be required to pay a $600 noncompliance fee and a $45 reinstatement fee.
What happens if the other driver doesn’t have liability insurance?
Virginia law requires that all auto insurance policies include uninsured and underinsured motorist coverage.
Let’s look at these options more closely:
- 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 full amount of damages.
As a reminder, the $500 UMVF is NOT insurance. As a consequence, if you opt to pay the UMVF (instead of purchasing liability insurance), you’ll be required to pay for your own damages if you’re hit by an uninsured or underinsured motorist.
Yes. All auto liability policies in Virginia provide coverage for “non-owner operators” so long as they are driving the vehicle with the permission of the “named insured.”
Optional car insurance coverage
In Virginia, there are several types of optional insurance coverage that you might want to consider adding onto your auto policy for additional protection:
- Funeral benefits coverage. This coverage pays a certain amount for funeral expenses if you or a family member dies as a result of a car accident, regardless of fault.
- Income loss. This coverage pays a portion of any lost wages due to a car accident.
- Comprehensive coverage. This coverage pays for theft or damage to your car from hazards like fire, flood, and vandalism.
- Extraordinary medical benefits. This coverage pays for medical expenses that exceed $100,000 (up to a maximum of $1.1 million).
- GAP coverage. This coverage pays the difference between an insurance company’s payment for a totaled vehicle and the balance of a vehicle loan.
Still have questions? An experienced Virginia attorney can help.
See our guide Choosing a personal injury attorney.