North Carolina Auto Insurance Requirements 2025 | Mandatory UM Guide

North Carolina requires 30/60/25 liability plus mandatory uninsured motorist coverage you can't reject. Learn state requirements and the strict verification system.

Quick Answer: Is Auto Insurance Required in North Carolina?

Yes. North Carolina requires all drivers to carry liability insurance and maintain continuous coverage. The state has a unique insurance verification system that actively monitors coverage status, and driving without insurance carries severe penalties including automatic license plate revocation.

North Carolina Minimum Coverage at a Glance

Coverage Type	Minimum Required
Bodily Injury (per person)	$30,000
Bodily Injury (per accident)	$60,000
Property Damage	$25,000
Uninsured Motorist BI	$30,000/$60,000
Uninsured Motorist PD	$25,000

This is written as 30/60/25—and North Carolina mandates uninsured motorist coverage that cannot be rejected.

What Each Coverage Type Means

Bodily Injury Liability ($30,000/$60,000)

$30,000 per person covers medical expenses, lost wages, and pain/suffering for one person you injure in an at-fault accident.

$60,000 per accident is the total maximum your insurance pays for all injured parties combined.

Example: You cause an accident injuring a family of four. Their medical bills total $120,000. Your insurance pays $60,000 maximum—leaving you personally liable for $60,000.

Property Damage Liability ($25,000)

Covers damage to other vehicles, buildings, fences, and property. North Carolina's $25,000 limit is better than many states but still inadequate for newer vehicles or multi-car accidents.

Uninsured Motorist Coverage (Mandatory)

North Carolina requires UM coverage equal to your liability limits. You cannot reject this coverage—it's automatically included.

What it covers:

Accidents with uninsured drivers
Hit-and-run incidents
Accidents with underinsured drivers

Approximately 7% of NC drivers are uninsured—lower than national average but still significant.

North Carolina's Unique Insurance Rules

Continuous Coverage Requirement

North Carolina requires uninterrupted insurance coverage for all registered vehicles. Even a single day without coverage triggers penalties.

Electronic Insurance Verification

The NC DMV uses the North Carolina Insurance Compliance System to monitor coverage in real-time:

Insurers must report policy issuance, cancellation, and lapses
Random verification checks throughout the year
Registration renewal requires proof of insurance
Immediate notification when coverage lapses

Rate Bureau System

North Carolina is one of few states with a Rate Bureau—the NC Rate Bureau files rates that most insurers must use. This creates more uniform pricing but limits shopping benefits for some drivers.

Assigned Risk Pool (NC Reinsurance Facility)

If you can't get insurance in the standard market, North Carolina's Reinsurance Facility ensures you can still get coverage. Insurers must participate, and rates are regulated.

Who Must Carry Insurance in North Carolina?

All registered vehicle owners
All drivers operating vehicles
Leased vehicle operators
Company car drivers
Teen drivers on family policies
Vehicles in storage (unless registration surrendered)

No Exceptions

Unlike some states, North Carolina offers no alternatives to insurance:

No cash deposit option
No surety bond option
No self-insurance for individuals

You must carry insurance—period.

Penalties for Driving Without Insurance

Immediate Consequences

Violation	Penalty
Lapsed coverage	Registration plate revocation
Driving without insurance	Class 1 misdemeanor
First offense fine	Up to $50
Subsequent offense	Higher fines + potential jail
Restoration fee	$50 per vehicle
SR-22 requirement	3 years

License Plate Revocation

North Carolina's system is aggressive:

Coverage lapses → DMV notified within days
Warning letter sent → 10 days to provide proof
No response → License plates revoked
Driving with revoked plates → Misdemeanor charge

Financial Responsibility (SR-22)

After a lapse or violation, you'll need an SR-22 certificate for 3 years. This increases premiums significantly—typically 30-60%.

Additional Coverage Requirements

Medical Payments Coverage

North Carolina doesn't require MedPay, but insurers must offer at least $1,000 in coverage. Many drivers add this for broader protection.

Comprehensive and Collision

Not required by law, but:

Lenders require it for financed vehicles
Lessors require it for leased vehicles
Recommended for vehicles with significant value

Why NC Minimums May Not Be Enough

Expense Type	Average Cost	NC Minimum
ER + hospital stay	$50,000-$150,000	$30,000
Average new vehicle	$48,000	$25,000
Serious injury lawsuit	$250,000+	$60,000
Multi-vehicle accident	$100,000+	$85,000 total

Recommended coverage: Insurance professionals suggest at least 100/300/100 for North Carolina drivers, particularly in metro areas like Charlotte, Raleigh-Durham, and Greensboro.

How to Get Compliant in North Carolina

Compare quotes: Despite the Rate Bureau, some variation exists
Meet minimums: 30/60/25 liability + mandatory UM
Ensure continuous coverage: Never let policy lapse
Keep proof in vehicle: Digital proof is acceptable
Verify DMV records: Confirm your insurance is properly recorded
Address lapses immediately: Contact DMV within 10 days of any lapse notice

If You Can't Get Standard Insurance

Contact the NC Reinsurance Facility through any licensed agent. They must help you obtain coverage through the assigned risk pool.

North Carolina SR-22 Requirements

When SR-22 Is Required

DUI/DWI conviction
Driving without insurance
Accumulating too many points
At-fault accident while uninsured
License revocation

SR-22 Duration

Standard: 3 years
Must maintain continuous coverage for entire period
Any lapse restarts the clock

SR-22 Cost Impact

Expect premiums to increase 30-60% during the SR-22 filing period. Combined with the underlying violation, total insurance cost increases can exceed 100%.

FAQ

What happens if my insurance lapses in North Carolina?

The DMV is notified within days. You'll receive a warning letter giving you 10 days to provide proof of insurance. If you don't respond, your license plates are revoked. Driving with revoked plates is a misdemeanor.

Can I reject uninsured motorist coverage in North Carolina?

No. North Carolina mandates UM coverage equal to your liability limits. Unlike most states, you cannot reject or reduce this coverage.

Is North Carolina a no-fault state?

No. North Carolina uses a tort system—the at-fault driver pays for damages. The state also follows "contributory negligence," meaning if you're even 1% at fault, you may recover nothing from the other driver.

Why is North Carolina insurance different from other states?

North Carolina has a Rate Bureau that standardizes many insurance rates, mandatory UM coverage that can't be rejected, and an aggressive electronic verification system. It also has a Reinsurance Facility that guarantees coverage availability.

What is the NC Reinsurance Facility?

It's the state's assigned risk pool for drivers who can't get insurance in the standard market. All insurers must participate, and any licensed agent can help you access it.

How do I prove insurance in North Carolina?

Keep your insurance card in your vehicle (digital is acceptable). The DMV also verifies coverage electronically, but you should carry proof for traffic stops and accidents.

Important Disclaimer

This guide provides general information about insurance requirements based on publicly available sources. This is not legal advice. Insurance requirements can change, and individual circumstances vary. Always verify current requirements with the North Carolina DMV or Department of Insurance, and consult with a licensed insurance professional for advice specific to your situation.

Last verified: December 2025
Sources: North Carolina DMV, North Carolina Department of Insurance, NC Rate Bureau