DMV Insurance Requirements in North Carolina
North Carolina DMV insurance requirements include the purchase of liability insurance coverage for anyone who has a valid license plate on a vehicle. The coverage must include the following minimum insurance limits:
- $30,000 of Bodily Injury for any one person
- $60,000 of Bodily Injury for two or more people
- $25,000 of Property Damage
In addition to the limits described above, every insurance policy must also include an amount of uninsured/underinsured motorist coverage equal to or greater than the bodily injury limit. This coverage protects you if you are in an accident with an at-fault driver who either doesn’t have their own liability insurance or has insufficient limits to cover damage or medical expenses.
Your insurance coverage must be purchased from one of the many insurance companies licensed and authorized to do business in North Carolina. DMV insurance requirements prohibit the State from accepting any out of state insurance policies.
To learn if the status of your insurance company is authorized, visit the North Carolina Department of Insurance website at www.ncdoi.com.
Once your policy has been issued, your insurance company will provide a proof of insurance certificate. Usually, the size of a business card, a copy of your proof of insurance should be kept inside your vehicle at all times.
The insurance policy you purchase must meet the DMV insurance requirements, thus, remaining in force for as long as a valid license plate remains on your vehicle. This is the only way to be compliant with the DMV insurance requirements. If your insurance coverage lapses for any reason, your insurance status will be reported to the State.
After receiving notification, the State will send a liability insurance termination notice. You will have 10 days from the date of the notice to respond. Failure to respond may result in civil penalties which increase depending on how many prior lapses you have had in the past three years.
The penalties for a lapse in coverage are:
- $50 for the first lapse
- $100 for the second lapse
- $150 for each subsequent lapse
If you fail to pay any levied penalties, the state retains the right to revoke and seize your license plate, in addition to imposing more penalties.
DMV insurance requirements have been in place since 1957. When the Vehicle Financial Responsibility Act was passed, it included some of the first enforced insurance laws.
The strictly enforced laws were implemented to compensate accident victims for property loss, and injuries and laws are in place to protect you and your fellow drivers.