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Colorado Car Insurance Guide: Everything You Need to Know about State Requirements

By law, every driver is required to have at least some insurance coverage in the event that they cause an auto accident which results in the injury of another person or damage of property. While this standard is set for everyone, each state is responsible for determining specific limits on certain types of coverage, meaning car insurance minimum requirements can vary state-to-state.

Most insurers recommend that your bodily injury liability insurance limits be set for at least $100,000 per person and $300,000 per accident. But you may be asking: What is the mandatory amount of insurance coverage I must have?

Auto Insurance Requirements

Up until 2003, Colorado was a "no-fault" state, meaning that any driver who was involved in an accident could collect medical, disability, and other compensation from their own insurance company, regardless of their degree of fault for the collision.

However, in order to help reduce the cost of insurance premiums, prevent claims abuses, and shed restrictions on non-economic losses such as pain and suffering, Colorado switched to the tort system. Under the current system, drivers who are seeking compensation must first establish fault before any insurance claim will be paid.

Furthermore, all Colorado drivers are obligated to carry liability insurance coverage for the following minimums:

  • Bodily Injury (BI) - $25,000 per person and $50,000 per accident. This coverage applies to accidents involving the death or injury of another person. Financial experts advise drivers to carry at least at 100/300 policy ($100,000 per person and $300,000 per occurrence). Carefully consider what you can afford when choosing your coverage amount.
  • Property Damage (PD) - $15,000 per incident. PD liability coverage insures you for damage done to someone else's property. Typically this is a vehicle, but it also covers damage to buildings, utility poles, and other physical property.

Beyond the mandatory minimum coverage requirements for Colorado drivers, insurance companies also offer several optional coverage types that are highly recommended, including:

  • Uninsured/Underinsured Motorist Coverage (UM/UIM) – Helps cover medical expenses and damages when you are hit by a driver without auto insurance or with insufficient coverage. Insurers in Colorado are required to offer UM/UIM coverage for the same amount as the bodily injury limits you choose, and it can only be waived if you reject it in writing.
  • Collision – Covers damage to your car caused by hitting other objects, such as a fire hydrant, wall, or another vehicle.
  • Comprehensive – Coverage for non-accident-related incidents or other factors like theft, extreme weather, and wildlife.
  • Medical Payments (Med Pay, or MPC) – Helps cover a portion of your injuries arising from an accident, particularly medical bills for treating head trauma. As of January 1, 2009, Colorado insurers are required to offer you $5,000 in coverage, unless you opt out.

Motorcycle Insurance Minimum Requirements

Just like four-wheeled automobiles, all two- or three-wheel motor vehicles in Colorado must be registered and insured based on the standards set by the state. Vehicles that fall into this category are motorcycles, motor-powered bicycles, scooters, and any other engine-powered mode of transportation with three wheels or less (excluding farm tractors).

Motorcyclists in Colorado must adhere to the same minimum requirements as drivers of cars: a 25/50 coverage policy with $15,000 for property damage. Failure to carry insurance in the event of a motorcycle accident can result in a $500 fine, four points on your driving record, and a possible suspension for the first offense.

Penalties for Driving Without Insurance

Failure to hold at least the required minimum insurance coverage can result in various penalties and fines, including:

  • 4 points on your driving record
  • $500 minimum fine (up to $1,000 for additional offenses)
  • Possible license suspension (until you show proof of insurance on first offense, or up to 8 months for additional offenses)
  • Up to 40 hours of community service

On top of these fines, you will likely face much higher insurance rates when you apply for coverage after a period of not having a policy.

Attempting to get avoid the mandatory minimum insurance coverage requirements as set by the state of Colorado simply isn't worth the risk. In fact, you may want to think about expanding your coverage if possible. That way, you can be sure you have financial help when you need it most.  

If you are involved in a collision with another driver who is uninsured or underinsured, then talk to an attorney who specializes in car accidents. Click here to learn more about Denver car accident attorneys at the Babcock Law Firm, or contact us for a free initial consultation of your case.

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**NOTE – this article and all content at Injurylawcolorado.com is for informational purposes only and does not constitute legal advice

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