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North Carolina Car Insurance Laws & State Minimum Coverage Limits

North Carolina car insurance requirements are 30/60/25 for bodily injury and property damage liability coverage. Get multiple North Carolina car insurance quotes with our comparison tool below to find the lowest North Carolina car insurance rates.

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Eric Stauffer is a former insurance agent and banker turned consumer advocate. His priority is to help educate individuals and families about the different types of insurance they need, and assist them in finding the best...

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UPDATED: Jul 15, 2020

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North Carolina State FlagNorth Carolina law requires all drivers to carry liability insurance meeting minimum requirements, as well as uninsured / underinsured motorist coverage. Drivers can choose to increase their limits beyond the legal minimum as well as to add options to their car insurance policy for more coverage. North Carolina follows a traditional auto insurance system of fault determination and liability.

Mandatory Insurance Coverage

The state minimums for auto insurance are designed to ensure financial responsibility on the part of all drivers in the event of an accident. Liability coverage is designed to pay for injuries and damages caused by a driver who is at fault in an accident.

Every vehicle must be covered by a policy that meets the following minimums:

  • Bodily Injury Liability in the amount of $30,000 per person and $60,000 per incident, to cover injuries to others in an at-fault accident.
  • Property Damage Liability in the amount of $25,000 to pay for damage to another person’s vehicle or other property when you are found at fault in an accident.
  • Uninsured/Underinsured Motorist coverage in an amount matching the minimum liability limits to pay for damages caused by a driver who is uninsured or whose insurance is inadequate to cover damages. This covers you and everyone in your vehicle and also provides protection against hit and run drivers.

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Optional Insurance Coverage

Drivers in North Carolina can increase their coverage by adding options and choosing higher liability limits than the legal minimum. Higher limits are often the first option drivers choose to improve their protection from the high cost associated with serious accidents.

In addition to choosing higher liability limits, North Carolina insurance companies also offer:

  • Collision Coverage – This provides for repairs or replacement of your car in an at-fault accident. There is usually a deductible associated with this coverage.
  • Comprehensive Coverage – This provides protection from the many risks to your vehicle that are not collision-related. This can include weather damage, theft, fire, and vandalism. Comprehensive coverage can also provide glass repair protection, and is generally subject to a deductible.
  • Medical Payments – This coverage is available to provide extra coverage for medical payments and funeral services for you and anyone in your car.
  • Additional Options – North Carolina auto insurers offer a wide range of additional coverage to allow drivers to create the policy that is right for their needs. Extra available coverage can include towing and labor, rental car reimbursement, and more.

Proof of Insurance Laws and Penalties

All drivers in North Carolina must not only carry insurance, but also be prepared to provide proof of their coverage. Insurance companies in North Carolina are required to notify the DMV when a policy lapses or is cancelled. The driver will then be notified that they have ten days to provide evidence of either sale or storage of the vehicle, or of a new insurance policy.

If there is a lapse in coverage, the state will charge civil penalties of $50 for the first offense within 3 years, $100 for the second lapse, and $150 for a third time. Drivers who do not respond within ten days to the notice will face a 30-day suspension of their vehicle registration and another fee of $50 for reinstatement.

In addition to the automatic notification of the DMV of a lapse in insurance, there are criminal penalties associated with driving uninsured.

Drivers must present proof of insurance upon request to a police officer. Driving without insurance is a misdemeanor that will result in charges; criminal courts will determine penalties that include fines, registration suspension, and even possible jail time. Penalties become harsher with each subsequent conviction in a three-year period.

Drivers who are involved in an at-fault accident while driving uninsured will not only face civil and criminal penalties for driving without insurance but can also be held responsible for damages caused. This includes bodily injury and property damage costs, for which the driver may face a lawsuit.

Buying Car Insurance in North Carolina

According to a 2017 study, North Carolina ranks as one of the more affordable states for auto insurance, with an average annual rate of $1010 for the test vehicles used. North Carolina insurance companies develop their own rates based on the risk factors they choose, allowing drivers to shop around for competitive rates.

North Carolina’s Safe Driver Incentive Plan allows drivers who keep a clean driving record to receive lower rates, while those with accidents or violations will see higher rates. The plan uses a points-based system to determine how rate increases will be calculated. The more serious the violation, the more points will be assessed against that driver and the higher the rate increase will be.

To assist drivers with choosing a reputable insurance company, the North Carolina Department of Insurance provides insurance company complaint ratio information on their website.

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High-Risk Driver Insurance

In order to make certain that all drivers are able to meet the legal financial responsibility requirements, North Carolina helps high-risk drivers through the Reinsurance Facility. Drivers who use this system to obtain coverage are those who have been unable to secure a policy in the open market due to serious problems with driving history.

Because the Reinsurance Facility is a last-resort choice, premiums tend to be high and coverage options are limited. While the policies allow all drivers to meet or exceed the minimum limits, they may not always provide all of the coverage options that are seen in standard policies, such as collision and comprehensive.

Teen Drivers in North Carolina

North Carolina uses a graduated licensing system for teen drivers similar to that used in most states. The program allows drivers to develop skills and practice on the road safely while working towards a full license. The graduated program begins at age 15 with a learner permit.

Limited Learner Permit

At 15, a teen can apply for a limited learner permit, which allows them to practice driving skills with supervision. To obtain the permit, the new driver must complete a driver education course and obtain a certificate.

The restrictions during this learning period are:

  • An approved driver who has held a license for at least 5 years and is over 21 must be in the passenger seat at all times – approved drivers are parents, guardians, or someone appointed by a parent or guardian
  • Driving is only permitted between 5 a.m. and 9 p.m. for the first six months
  • The driver is prohibited from using any mobile device while driving, even hands-free

Limited Provisional License

In order to apply for the provisional license, a driver must be 16 years old and complete several steps:

  • Hold a learner’s permit for at least 12 months
  • Complete 60 hours of driving practice, at least 10 of which must be at night, certified by a supervising driver
  • Have a clean record for the previous 6 months
  • Pass a road test

Once the provisional license is obtained, there are still some restrictions that must be followed at all times. The teen can now drive without supervision, as long as they are in compliance with these rules:

  • Unsupervised driving is only allowed between 5 a.m. and 9 p.m., except for work or religious reasons
  • No more than one passenger under the age of 21 is permitted in the vehicle during unsupervised driving
  • Use of a mobile device while driving is prohibited

Full Provisional License

After six months with the limited provisional license, the teen driver can graduate to a full provisional license, which allows unsupervised driving at any time. Drivers are still not permitted to use a mobile device of any kind while driving.

Full Unrestricted License

The graduated licensing program ends when the teen driver reaches the age of 18, at which point the provisional license can be turned in and a full, unrestricted license obtained.

All teen drivers are required to maintain a Driving Eligibility Certificate until they have completed high school. Teens under 18 in North Carolina who drop out of school before graduation will have their driver’s license revoked. A teen driver’s license can also be revoked if they are suspended from school for more than 10 days or moved to an alternative educational setting as a result of behavioral problems.

Liability insurance for teen drivers is required in North Carolina as soon as the teen receives a limited probationary license. This coverage can be obtained by adding the teen to a parent or guardian’s current car insurance policy until the teen is no longer a resident at home. Teens away at school can continue to be covered under a parent or guardian policy.

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Review Information

About Eric Stauffer

Author: Eric StaufferI am a former insurance agent and banker turned consumer advocate. My priority is to help educate individuals and families about the different types of insurance they need, and assist them in finding the best place to get it.


  1. Hi, I’m making payments on my car, so I’m required by law to have full coverage here in NC or is the liability one good enough to comply with the state law?

  2. Hello, my name is Rain and I am 19. I got my full license in 2018 because I wanted to open a bank account and they wouldn’t accept my state ID. I also did it because on some college applications they say they require it and I am going abroad and needed a passport. So I got it and now Nationwide wants to charge my family an extra $1500 on top of their $800 every 6 months. Which is ridiculous because we have been in no accidents and we have been with them for 31 years. I do not own a car and I don’t ever plan on driving. I have Uber AND I’m starting college so my first year I can’t even have a car on campus. I will not have access to either of my parents’ vehicles because I will be 200 miles away in college. What do I do? I explained this to them but they said they will take away my license if I am not insured. This is in North Carolina and I really have no idea what I’m supposed to do because my family can’t afford $1500, but I need my license for my bank account and passport.

    • Hi Rain,

      Your insurance company may be able to add you as an EXCLUDED DRIVER to the policy. This means that you will be removed from the pricing of the policy. Be warned – If you are listed as an excluded driver on the policy, NEVER drive that car. It will be the same as not having insurance if you get in an accident.

      If Nationwide won’t do it, try asking around with an insurance broker to find a company that will.

      Eric Stauffer

  3. My son is 21, in the US Navy and stationed in Virginia. He is listed as a driver on our policy. Is he still considered a resident of our household? He is currently saving to purchase a vehicle of his own. If he purchases his own insurance policy, does he have to carry the higher liability limits our policy has?

    • Hi Tammy,

      I am not an expert on the residency requirements of a stationed serviceman, so I can’t be sure on the answer. I would call your insurance agent and ask. It seems likely that they wouldn’t need to be listed anymore.

      If your son is going to get their own car, they can certainly get their own policy. They can even get their own insurance company if they wish. Again, its best to speak with your agent directly.

      Eric Stauffer

  4. If I do not own a car but drive someone else’s car, am I required by the law to carry insurance for myself?

    • Hi Crystal,

      It depends on the details of the situation.

      If you are talking about borrowing a friend’s car that doesn’t live in your household a few times, then generally not. On the other hand, if you have a roommate and drive their car frequently, it would be wise to have them add you to their policy as a driver. Your best bet is to contact the insurance company of the person whose car you plan on driving.

      Eric Stauffer

  5. Can a 16-year old that owns her own car carry a liability insurance policy in her name only in NC?

    • Hi Kacey,

      Your insurance agent or broker would be the best person to ask. Typically not, since minors cannot enter into contracts in most cases, but it may be worth a phone call to ask.

      Eric Stauffer

  6. I live with my boyfriend. We bought a car in both of our names. Can I add him and the other cars (one is in his name only) to my insurance policy? We do live in NC.

    • Hi Becky,

      Yes, that shouldn’t be a problem. Most insurance companies prefer or require that all eligible drivers in a household be listed on an auto policy anyways.

      Give them a call and they should be able to help you out.

      Eric Stauffer

  7. I don’t own a car and plan to travel, so I have no need to purchase a plan.. I will need to borrow friends car in future, does their insurance cover me? Will I get in trouble for not having a personal plan? I can’t find anything that says it is a law.. More of a suggestion

    • Hi Jeska,

      Your best bet will be to have your friend call their insurance company and ask them directly. Typically it will, especially when being used infrequently, but its better to be safe by asking the company that is insuring the vehicle.

      Eric Stauffer

  8. Why is New Car Replacement insurance unavailable in NC?

  9. I am a resident of North Carolina. When my son turned 16, my sister-in-law added him to her insurance. My son lives with me. My insurance company is saying that since he lives with me he has to be on my insurance by state law. Is this true?

    • Hi Jamie,

      In most cases, yes. Any driving-age person in the household typically needs to be on the policy.

      There are situations when you can exclude a driver. If you do so, they can NEVER drive the car. If a policy lists an excluded driver, its the same as there being no insurance if that person gets behind the wheel.

      If you are interested in excluding a driver, call your insurance company. Not every company will allow it, and sometimes local laws may prevent it altogether.

      Eric Stauffer

  10. I am new to the state of North Carolina and I purchased a vehicle my insurance company was closed so I could not add it but I do have full coverage on my other vehicles. Is it true that as long as I have full coverage insurance it automaticly extends to my new car for several days until even thou my insurance company is closed when I drive off the dealerships lot ?

    • Hi Clareon,

      It will be completely dependent on the insurance company. The first thing I would do is try and call the ACTUAL insurance company directly, and not just your agent. Many companies have 24 hour phone lines you can call, and get them to add temporary coverage for your new car until you have time to figure everything out.

      Eric Stauffer

  11. Hello, Our Granddaughter that lives with us is turning 18 in April of this year. She currently has a driver’s permit which will expire on her birthday and just wants to get her driver’s license. She wants to get her own insurance policy and we been told that there is a policy in the state of NC, called a No Car Policy. At one time had thought of putting her on our insurance but have decided that we don’t want to do this because she will more than likely be moving out sometime within the next year after graduating in Jan. 2018. With this being said, Is there a such of insurance policy as a No Car Policy and if so, what insurance copies provide this. Also, would we still have to add her to our policy with Farm Bureau?

    • Hi Teresa,

      What you may be looking for is non-owner car insurance. Its typically purchased by someone that doesn’t own a car, but frequently drives other’s cars (rentals, car share services, borrowing, etc.) I would speak with your current agent, because they may require your granddaughter to either be on your policy, or be listed as an excluded driver. Insurance companies are very particular about licensed drivers that live within the same household.

      Eric Stauffer


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