Auto insurance is typically required of all licensed vehicles. It can vary from state to state as each state has their own requirements for the minimum coverage.

The state of Minnesota requires all licensed vehicles to carry insurance. The minimum requirements of auto insurance are Personal Injury Protection (PIP), Liability, Uninsured and Underinsured. Two types of optional types of coverage are collision and comprehensive.

PIP pays for you and others in your household in the event of an accident. It covers lost wages, medical expenses and also replacement. PIP is used no matter whose fault the accident is. Minnesota's minimum PIP coverage is $40,000 per person per accident. That amounts to $20,000 for medical expenses, including hospitalization and $20,000 for costs not considered medical.

Liability coverage is what covers the driver when the accident is their fault. This covers any damage done with their car. The minimum coverage for liability is $30,000 for injuries to one person, $60,000 for injuries to two or more people, and $10,000 for physical damage to the other car or property.
Uninsured coverage pays your expenses after PIP has been exhausted when the other driver is at fault with no insurance. The minimum coverage for uninsured coverage is $25,000 for one person with injuries and $50,000 for two or more people with injuries.

Finally, we have underinsured coverage. This is coverage that comes into use after PIP is exhausted but the at fault party doesn't have enough liability coverage to cover the medical expenses of the other car's occupants.

Collision insurance is an optional insurance that will cover your vehicle when there is damage to it either from an accident with another car or object. Comprehensive insurance is used when the damage is not from a collision. The can include, but not limited to fire, deer/car collision, break-in or even objects hitting the car and causing damage.

Auto insurance requirements for Minnesota are set so that the insured driver is protected from the financial burden in the event of an accident. The minimum requirements insure the policy holder has the proper coverage when its needed.