Iowa’s Car Insurance Laws

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Iowa car insurance laws require drivers to carry liability insurance to protect themselves, other drivers, and pedestrians.
If you’re caught driving without the required minimum liability insurance in Iowa, you could face penalties including fines, license suspension, and serious financial liability in the event of an accident.
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Read on to learn more about Iowa car insurance minimum requirements.

What are Iowa’s Car insurance minimum requirements?

Through the Motor Vehicle Financial and Safety Responsibility Act, Iowa requires that drivers carry bodily injury and property damage liability insurance. This is the only insurance Iowa requires drivers to have.
  • Bodily injury liability pays for the costs associated with the injuries you’ve caused to others—it does not cover your own injuries.
  • Property damage liability covers the costs associated with any damage you cause to other people’s vehicles or property.
Iowa operates on a fault-based system when it comes to car accidents. The drivers involved in the crash must be able to show financial responsibility for damages or risk license and vehicle registration suspension and suspension of vehicle registration privileges.
Failure to comply with the minimum required insurance can result in severe penalties and even jail time. You could also be liable for any property, economic, and physical damage incurred.
Minimum Liability Coverage for Iowa – 20/40/15
$20,000 for bodily injury per person
$40,000 for bodily injury per accident
$15,000 for damage of property per accident
While this is the minimum insurance required to legally drive in Iowa, it’s always a good idea to purchase more coverage if you can afford it.

What is modified comparative negligence in Iowa?

Modified comparative negligence is used to determine who’s at fault in an accident. Under this system, both drivers are held responsible for damages according to their percentage of fault.
If a driver is found 51% or more at fault, they will not be able to recover damages.
Let’s say you were in a car accident where the other driver was found 70% at fault and you were 30% at fault. You would receive 70% of whatever the ruling amount is, but the other driver would get nothing since they were the most at fault.
Key Takeaway Iowa is an at-fault state that requires drivers to carry 20/40/15 liability insurance, at a minimum.
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Iowa state-mandated limits

A state-mandated limit is the lowest amount of insurance that you are allowed to have. In Iowa, this is the split limit 20/40/15 liability coverage:
  • $20,000 bodily injury liability for one person
  • $40,000 bodily injury liability for multiple people in one accident
  • $15,000 property damage liability for one accident
In your insurance policy, the amount you agree on for the split limit is the maximum amount your insurer will pay out in a claim. If damages exceed this limit, you will be responsible for paying the remainder out of pocket.

Do Iowa’s required car insurance minimums provide enough coverage?

Unfortunately, no. Most state limits for liability insurance are rather low and wouldn’t cover a serious, damage-heavy accident.
If you can afford it, you’re always better off purchasing as much coverage as you can. It’s always better to have more than enough coverage than to find yourself short.
Key Takeaway For peace of mind and greater financial protection, it’s best to purchase more than the minimum required insurance coverage.
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Penalties for driving without insurance in Iowa

Iowa requires drivers to carry digital or physical proof of insurance. If you do not have proof of insurance, you can face penalties including:
*A fine of $250 fine
  • A 1-year license suspension for damages exceeding $1,500
  • Vehicle registration suspension
The best way to avoid these penalties? Buy insurance!
If you’re worried about the cost, don’t be—get the car insurance comparison shopping app Jerry. In just seconds, Jerry searches more than 40 providers to find you the best coverage for the cheapest prices. All you need to do is choose your plan and enjoy the peace of mind (and the savings!).

Additional car insurance options in Iowa

While liability insurance provides you with the basics, your insurer has plenty of other options to protect you, your assets, and your loved ones. Below are some of the most common optional coverages:
Optional CoverageDescription
Collision coverageCovers damage to your vehicle resulting from an accident with another car or object
Comprehensive coverageCovers damage that occurs not as the result of a collision (e.g., vehicle theft, severe weather, vandalism)
Gap coverageCovers the difference between the actual cash value of your vehicle and the remaining amount on your loan in the event that your car is totaled
Medical payment (MedPay)Pays for your or your passenger’s medical bills or funeral costs incurred in an accident
Uninsured/underinsured motorist insuranceReimburses you for your expenses stemming from an accident caused by an uninsured driver
Rental car reimbursementPays for your rental car while your vehicle is being fixed after a claim
Roadside assistanceCovers the cost of towing, battery chargers, and other expenses related to a car breakdown

Is Iowa a diminished value state?

Yes, Iowa is a diminished value state—that means a driver can recover diminished value from the at-fault driver’s insurance company.
If your car is in an accident, the resale value decreases. A diminished value claim helps you recover the lost value when you sell or trade-in your car.
To file a diminished value claim in Iowa, you must meet the following criteria:
  • Provide proof of value from a trusted source
  • Not be at fault for the accident.
  • Damage is related to the collision
  • Make the diminished value claim within two years of the accident
Iowa offers uninsured motorist coverage for diminished value claims.

Finding affordable car insurance

Finding affordable car insurance doesn’t have to be a hassle. If you want to save money on your premiums, the Jerry app is a good place to start.
As a licensed broker, Jerry does all the hard work of finding the cheapest quotes from name-brand insurance companies and finalizing your new car insurance. Jerry will even cancel your old policy for you.
And to ensure you always have the lowest rate, Jerry will send you new quotes every time your policy comes up for renewal—so you’re always getting the coverage you want at the best price. This level of service is why Jerry earned a 4.6/5 rating on the App Store and made it the top insurance app in the country.
“Get this app and let it help you save money!”—Jerry user
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Does Iowa have a compulsory auto insurance law?

Iowa does not have a compulsory auto insurance law but instead uses the Motor Vehicle Financial and Safety Responsibility Act.

What insurance is required in Iowa?

All drivers must have liability insurance, though it’s always a good idea to purchase more than the state-required minimum insurance if you can afford it.
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