Most states have laws  that require basic auto insurance coverage for every driver, although a few states simply ask only that you demonstrate 'financial responsibility'. Requirements vary from state to state, and tend to include the following:

Minimum Liability Coverage

Most states require drivers to carry the state-mandated minimum amount of liability coverage (bodily injury and property damage).

Uninsured Motorist Coverage

This covers you if you're involved in an accident with an underinsured (or uninsured) driver. In some states, you can opt out of purchasing uninsured motorist coverage; however, if you're involved in an accident with an uninsured driver, then you may have to pay for damages out-of-pocket.

No-Fault States

In no-fault states, insurance companies are legally required to pay a policyholder's covered losses, regardless of who's held responsible for an accident. In some of these states, the insurance company covering the person who caused an accident is forced to pay for covered losses. Some no-fault states also restrict the right to sue for damages.

No fault-states include:

• D.C.
• Delaware
• Florida
• Hawaii
• Kansas
• Kentucky
• Maryland
• Massachusetts
• Michigan
• Minnesota
• New Jersey
• New York
• North Dakota
• Oregon
• Pennsylvania
• Texas
• Utah
• Washington

Personal Injury Protection (PIP)

In Florida, Maryland, Michigan, Minnesota, New Jersey, New York and Oregon Personal Injury Protection (PIP) is mandatory. This type of cover generally includes expanded coverage of accident-related medical costs, and in some states, also pays for lost wages and similar losses. Specific protections and limits on PIP payments vary widely from state to state.