North Carolina Auto Insurance Laws, Minimums, Requirements

What mandatory auto insurance laws exist in the state of North Carolina?

• In the state of North Carolina, all motor vehicles must carry liability insurance in the mandatory minimum amounts of $30,000/$60,000 for bodily injury, $25,000 for property damage, $30,000/$60,000 uninsured/underinsured motorist bodily injury, and $25,000 uninsured/underinsured motorist property damage liability.
• You must carry proof of auto liability in your vehicle at all times.
• If you are caught driving without auto insurance in the state of North Carolina, the North Carolina DMV will revoke your license plates for at least 30 days. In order to reinstate your license plates, you must provide proof of insurance and pay a $50 restoration fee, any applicable license plate fees, and a $50 service fee.

What is the Minimum Liability Coverage (Bodily Injury amounts per person, per accident, and property damage amounts):

If you buy automobile insurance in North Carolina, your policy must include minimum liability coverage of:

$30,000/$60,000 for bodily injury,
$25,000 for property damage,
$30,000/$60,000 uninsured/underinsured motorist bodily injury,
and
$25,000 uninsured/underinsured motorist property damage liability

What are the Rental Car Insurance Requirements?

In the state of North Carolina, it is illegal to operate any motor vehicle without insurance, this includes rental cars. Rental cars must carry the minimum liability coverages required under North Carolina auto insurance law. It is important to keep in mind that most North Carolina auto insurance policies include coverage car rentals. Most credit cards cover car rentals as well, so be sure to check your auto insurance policy and/or check with your credit card issuer. If you find that your credit card and/or auto insurance policy do not cover rental cars, you must purchase car rental insurance from the car rental company. It typically costs an extra $7-$14 a day.

What are the rules pertaining to Uninsured/Underinsured Motorist Coverage?

Uninsured/Underinsured Motorist Coverage is mandatory in the state of North Carolina in the amount of $30,000/$60,000 uninsured/underinsured motorist bodily injury, and $25,000 uninsured/underinsured motorist property damage liability.

What are the rules pertaining to the exclusion from coverage of a driver living in household?

In North Carolina, auto insurance companies can write policies that exclude household members. These exclusions are listed in the policy’s exclusions section, which also includes a list of all possible circumstances that would free the insurance company from the responsibility of paying a claim. It is important to examine your auto insurance policy carefully before signing on the dotted line.

What are the rules regarding whether a driver has prior insurance? That is, how does state law handle it if a driver has no prior insurance or has let their previous insurance lapse?

In the state of North Carolina, if your auto insurance lapses, your insurance company is required by law to notify the North Carolina Division of Motor Vehicles. The Division of Motor Vehicles will send you a notice called a "Form FS 5-7 Notice." You have 10 days to respond to the North Carolina DMV with proof of insurance or the DMV will revoke your license plates for at least 30 days. In order to reinstate your license plates, you must provide proof of insurance and pay a $50 restoration fee, any applicable license plate fees, and a $50 service fee. If you surrender your plates to the North Carolina DMV within the 10-day period, you may avoid having to pay the fees.

What are the rules and guidelines auto insurance companies must follow regarding the use of Personal Credit History in selecting applicants and setting rates?

In the state of North Carolina, auto insurance companies can use your credit history to determine rates and offers for products. Auto insurance companies do not use Personal Credit History alone to figure rates. They may also consider age, gender, where you live, car make and model, how much you drive, and prior insurance coverage.

Is the state a No Fault or Tort state? What does either mean to the policy owner?

North Carolina follows a Tort System. What this means is, if you are involved in an accident, someone must be found to be the cause or fault of the accident. The person deemed at fault is responsible for all damages. Damages are usually handled through the at-fault person's insurance company. Because North Carolina is a Tort state, most insurance companies recommend that driver’s consider carrying higher coverages than the state minimums. 

What is the average auto insurance premium in this state? As of what year?

As of 2006, North Carolina resident’s average insurance premium was approximately $596, the 44th most expensive in the nation. This was down 1.0% from the previous year. The national average was $817.

Sources

Insurance Information Institute

North Carolina Department of Insurance