Indiana Car Insurance Laws and Requirements

Here's what Indiana drivers need to know about the state's car insurance rules, including Indiana's minimum liability coverage requirements.

By , J.D. · University of San Francisco School of Law

Car insurance is sure to play a big part in any claim brought after a traffic accident. Indiana, like most states, requires vehicle owners to maintain financial responsibility for any accident they might cause. Most drivers do this by purchasing car insurance that's in line with the minimum coverage required under Indiana law.

Read on for the details of Indiana's auto insurance rules and how coverage is likely to affect a car accident case.

Is Indiana a "No-Fault" Car Insurance State?

No. Indiana follows a traditional "fault"-based system when it comes to financial responsibility for losses stemming from a car accident: injuries, lost income, vehicle damage, and other "damages". This means that the person who was at fault for causing the car accident is also responsible for any resulting harm (from a practical standpoint, the at-fault driver's insurance carrier will absorb these losses, up to policy limits).

In Indiana, a person who suffers any kind of injury or damage due to an auto accident usually can proceed in one of three ways:

  • by filing a claim with his or her own insurance company, assuming that the loss is covered under the policy (in this situation, the injured person's insurance company will likely turn around and pursue a subrogation claim against the at-fault driver's carrier)
  • by filing a third-party car insurance claim directly with the at-fault driver's insurance carrier, or
  • by filing a personal injury lawsuit in civil court against the at-fault driver.

Note: In no-fault car insurance states, a claimant doesn't usually have this same range of options.

What Car Insurance Is Required In Indiana?

In order to comply with Indiana's motor vehicle financial responsibility laws, drivers are usually required to carry liability car insurance coverage at the following minimums:

  • $25,000 for bodily injury or death of one person in an accident caused by the driver of the insured vehicle
  • $50,000 for total bodily injury or death liability in an accident caused by the driver of the insured vehicle, and
  • $25,000 for property damage per accident caused by the driver of the insured vehicle.

This basic coverage pays the medical bills, property damage bills, and other costs of drivers, passengers, and pedestrians who are injured or have their vehicle damaged in a car accident you cause, up to coverage limits.

You can (and in some situations should) carry more coverage to protect you in case a serious crash results in significant car accident injuries and vehicle damage. Remember, once policy limits are exhausted, you are personally on the financial hook, so higher insurance limits can help protect your personal assets if you end up causing a serious crash.

Who Is Covered Under Liability Car Insurance In Indiana?

Your liability coverage will kick in if any family member is driving your vehicle, or if you've given someone else permission to use it. It will likely also cover you if you get into an accident in a rental car.

Liability Car Insurance Won't Cover Your Own Car Accident Losses

Remember that the liability coverage we discussed here doesn't apply to your own injuries or vehicle damage after an Indiana car accident. You'll need different (additional) coverage for that if you're involved in a car accident and no one else's coverage applies to your losses. For example, collision coverage (optional in Indiana) can pay for repairs to (or replacement of) your damaged vehicle after a car accident, regardless of who was at fault.

Request for Financial Responsibility Verification in Indiana

According to the Indiana Bureau of Motor Vehicles, if you're involved in any of the following driving-related incidents, you can expect to receive a request for verification of financial responsibility at your mailing address:

  • a car accident for which a report is filed with the BMV
  • multiple "pointable" moving violations within a certain time, or any "pointable" violation after your driving privileges were previously suspended, or
  • a misdemeanor or felony traffic violation.

If you receive this kind of request, you'll need to make sure your insurance provider files a "Certificate of Compliance" with the BMV.

Can I Show Proof of Insurance On My Phone In Indiana?

Yes. Indiana law now allows drivers to pull up an electronic image of their car insurance card using their insurance company's app. So, when you're asked for the kind of "financial responsibility verification" we discussed in the previous section, you can produce it using your phone, tablet, or other device.

Uninsured/Underinsured Motorist Coverage in Indiana

In Indiana, all car insurance policies must include uninsured motorist coverage (UIM), in an amount equal to the liability minimums spelled out above (plus another $50,000 in underinsured motorist coverage for bodily injury) unless these coverage options are waived in writing by the policy purchaser.

So, uninsured/underinsured motorist coverage isn't mandatory in Indiana, but if you don't want this coverage, you'll need to put your decision to decline it in writing when you're buying your policy.

Penalties for Violating Indiana's Motor Vehicle Financial Responsibility Laws

For a first violation of Indiana's motor vehicle financial responsibility laws, the punishment is usually suspension of driving privileges, and the driver may need to carry a special kind of insurance (SR22 insurance) going forward. Of course, penalties like these will likely pale in comparison to the financial hit you could take if you're in a car accident and you don't have car insurance.

Indiana's "No Pay, No Play" Car Insurance Law

Another penalty related to driving without insurance can come under Indiana's "no pay, no play" law (which can be found at Indiana Code section 27-7-5.1-5). This law says that you'll be barred from recovering "non-economic" damages in any car insurance claim if:

  • you were driving without insurance (or without any other form of financial responsibility) at the time of the crash that led to the current claim, and
  • you have a previous violation of Indiana's financial responsibility laws (including situations where an uninsured vehicle you own was involved in an accident).

Non-economic damages include compensation for your physical and mental "pain and suffering," and losses like these are often the biggest determinants of case value, so this law can have a major impact on your injury claim.

Getting More Information and Help

You'll find more details on auto insurance in Indiana on the state's Department of Insurance website. You can also learn more about:

If you've been involved in a car accident in Indiana, you might want to understand more about your options. Learn how an attorney can help with your car accident case.

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