What Car Insurance Do I Need in Iowa?

• What Is Iowa's Financial Responsibility Law?
• What Does Liability Car Insurance Cover in Iowa?
• Is Iowa's Minimum Required Car Insurance Coverage Enough?
• What Are the Penalties for Uninsured Drivers in Iowa?
• Get Help With Your Iowa Car Insurance Questions

Is Iowa's Minimum Required Car Insurance Coverage Enough?

Maybe not, at least not if/until the proposed new law passes, and the (low, compared with other states) minimum coverage requirements are increased substantially. When assesing your coverage amounts, consider these two questions:

• Do I have enough insurance to pay for damages I cause to others?
• Do I have insurance to compensate me if I'm hurt in an accident?

Paying Damages to Others

If you cause a serious car accident in Iowa, you'll almost certainly burn through the state's minimum liability coverage requirements ($20,000/$40,000/$15,000) very quickly. Keep in mind that you're on the hook for all damages you cause, regardless of whether you have enough insurance coverage. Talk to your insurance agent about how much liability insurance you need.

Insurance to Get Compensation for Your Own Injuries

How will you be compensated if you're injured in an accident? The answer is likely to depend, at least in part, on who was to blame. If the wreck was the other driver's fault, chances are you'll file a third-party insurance claim or a lawsuit against them to recover your compensatory damages.

But what if the responsible driver is uninsured? Worse yet, what if you're the responsible driver? In either of those situations, you might decide to file a claim under your own auto or other insurance policies. To do that, you'll need to make sure you have the necessary coverages in place. Here are a few examples.

You're hit by an uninsured motorist (UM) or an underinsured motorist (UIM). Give some thought to what you'll do if you're hit by an at-fault uninsured motorist or underinsured motorist. Under Iowa law, every auto liability policy must also have UM and UIM insurance coverages equal to the state's financial responsibility minimums, as discussed above. (Iowa Code § 516A.1.1.)

But these aren't really required coverages, because the named insured is allowed to reject them, in writing. (Iowa Code § 516A.1.2.) If you want this insurance, speak to your agent to make sure you haven't unknowingly rejected it. And keep in mind that UM and UIM only pays for your car accident injuries when you're hit by an uninsured driver; they won't cover damage to your vehicle.

You need to get your car repaired quickly. Suppose your car is damaged and can't be driven without repairs. If the accident was the other driver's fault, and if that driver is insured, you can collect the repair or replacement cost from their liability insurance.

Here's the problem: It's likely to take some time—time you can't afford to wait—to settle your claims with the other driver's insurance company. Until that happens, your car might have to remain out of commission unless you have some other way to pay for repairs.

If you have optional collision coverage as part of your auto policy, you can get your car fixed or replaced much more quickly. Note that collision insurance is a form of no-fault coverage, so it will cover your auto repairs even if the accident was your fault.

You have health insurance that will pay your medical bills. If you have a health insurance plan, you can almost certainly submit your medical expenses for payment or reimbursement under that policy. Once you settle with the responsible driver, your health insurer likely will expect to be reimbursed for any amounts it paid.