Although Minnesota is labeled as a no-fault state for insurance purposes, like every other no-fault state in the U.S. Minnesota’s no fault status only applies to medical payments and injuries sustained in an accident, meaning that the at-fault driver can still be found liable for the financial cost of an accident. Since Minnesota car insurance law is based on both no-fault and tort principals Minnesota and other “no-fault” states are often referred to as hybrid states. Because Minnesota’s no-fault laws only require insurance companies to pay for their customers injuries related to an accident Minnesota drivers are still required to maintain liability coverage on their vehicles. In order to satisfy the no-fault portion of Minnesota car insurance law residents of the state are required to maintain at least $40,000 in personal injury protection. Personal injury protection is the coverage that is will pay for any medical bills and lost wages that result from injuries sustained in an accident. The minimum $40,000 in coverage established by the state includes $20,000 for medical payments and $20,000 for lost wages.
In order to satisfy the tort based portion of Minnesota State car insurance law residents are also required cover their vehicle with liability insurance. Like personal injury protection, the minimum amount of liability insurance a car must have is set by the state and currently stands at $30,000 for injuries to a single individual, $60,000 or injuries to multiple people and $10,000 in property damage liability coverage. Unlike Personal injury protection, which is paid to the policy holder, liability coverage only insures the driver involved in an accident that the policy holder caused. Although fault does not have to be established for personal injury protection insurance to be paid out, liability insurance will not be rewarded until a driver is found at fault in the accident. Residents of Minnesota are also required by law to carry minimum levels of uninsured and underinsured motorist coverage on any vehicle that they own. The current minimum levels of uninsured and underinsured motorist coverage required by the state sit at $25,000 for an injury to a single person and $50,000 for injury to two or more people. The levels of uninsured and underinsured motorist coverage are the same and must be purchased in the same amounts when buying a car insurance policy in Minnesota. Every type of coverage required by Minnesota car insurance law can be purchased in greater amounts than the minimum limits set by the state. Additionally, there are also a few types of coverage which are optional for residents and are not required to be a part of an auto insurance policy. Minnesota, like most other states, allows collision and comprehensive coverage to be purchased by residents on a voluntarily basis; though the state does recommend certain amounts of each type of coverage be purchased as part of an insurance policy. Despite the fact that Minnesota requires so many different forms of coverage to be maintained on a vehicle the state as a whole still ranks 25th out of 50 in terms of car insurance premiums, with Minnesota residents paying an average of $753 a year for car insurance.
The car insurance required by the state of Minnesota can function a bit differently than in other states, primarily because there are so many types of coverage required. In Minnesota, some forms of car insurance are applied to the policy holder and not the actual vehicle. Personal injury protection for instance covers the policy holder no matter which vehicle they are driving. If a driver borrows a car from a friend in Minnesota and is involved in a car accident the driver’s personal injury protection will be responsible for their medical bills if they are injured but the vehicle owner’s policy will still be responsible for any other costs associated with the accident.
Minnesota law also requires that residents carry proof of insurance with them at all times and must be able to provide it if pulled over by a law enforcement officer. Residents of Minnesota that drive without insurance on their vehicle are committing a misdemeanor according to state law and if caught could face a series of penalties that are much more costly than an insurance policy. A driver that is caught without insurance in Minnesota will generally be issued a citation and may be required to appear in court. If a driver cannot provide proof of insurance by the court date they will likely receive a fine ranging from $250 to $1,000 and could even face as many as 90 days in jail. Any subsequent offenses within a 10 year period of a driver’s first offense are considered by state law to be gross misdemeanors and are punished much more harshly. In some localities a driver may be able to obtain a lesser penalty if they purchase an insurance policy that meets state requirements before they have to appear in court.