The Complete Guide to Car Insurance in Illinois

Unlock the essentials of car insurance in Illinois. A comprehensive guide to coverage options, requirements, and informed decision-making for drivers.

Car Insurance

If you’re a new driver, congratulations! If you’re a long-time driver’s license holder, you may already be familiar with Illinois car insurance requirements. However, it never hurts to refresh your memory, and new drivers may not be familiar with everything they need to know. 

Car insurance in Illinois isn’t a suggestion; it’s a legal requirement. In other words, if you’re driving without car insurance, you can face fines, license suspension, and maybe even jail time.

Guide to Car Insurance in Illinois

Minimum Car Insurance Requirements in Illinois

Illinois, like every other state, has minimum car insurance requirements. If you’re wondering why you must carry auto insurance, the answer is simple. 

Your insurance covers damages if you’re involved in an auto accident. These damages can include medical expenses and property repair and/or replacement costs. Basically, the insurance helps ensure the non-fault driver isn’t paying out of pocket for their expenses.

There are two main types of car insurance: liability and full coverage. While full coverage is great to have, this type of insurance covers damages to your vehicle and the other drivers, even if you’re the one at fault. However, full-coverage insurance can be pricey, and it’s not required by Illinois state law.

What is required by Illinois state law is liability insurance, and no, you can’t opt out; this is an expense you’re legally required to pay. The state also has strict minimum requirements drivers must meet, which are:

  • $25,000 bodily injury liability per person
  • $50,000 bodily injury liability per accident
  • $20,000 property damage liability per accident

If you drive a government or corporate vehicle, the minimum insurance requirements are a little different. However, since these vehicles are owned by a government entity or corporation, the insurance is the responsibility of the vehicle owner and not the driver. The driver does need to carry a valid license; there aren’t any exceptions.

What About Underinsured Motorist Coverage?

With minimum liability insurance caps at $50,000 for injuries and less than $30,000 for property damage, it’s a good idea to consider getting underinsured motorist coverage. This type of insurance is also a legal requirement, but instead of looking at it as another expense, think of it as a safety net.

So, what is underinsured insurance, and why is it a good idea? With the low cap requirements for liability insurance, if you’re involved in an accident, there’s a good chance you’ll have outstanding debt. 

Even treatment for a broken bone typically exceeds $50,000, especially if you end up in the emergency room. By the time you’re finished with follow-up visits, the at-fault driver’s liability coverage isn’t going to be enough to pay off all of your damages, which is when underinsured coverage kicks in.

Underinsured coverage picks up where the at-fault driver’s insurance ends, and it also covers medical and property damage expenses if the at-fault driver isn’t insured. Your underinsured policy applies if you’re involved in a hit-and-run accident. Average minimum coverage amounts are:

  • $20,000 bodily injury liability per person
  • $40,000 bodily injury per accident to you and your passengers

As mentioned earlier, it is a legal requirement, and you may be glad you have the coverage if you’re in an auto accident.

Potential Penalties for Driving without Insurance

Driving without liability insurance rarely results in jail time, but an exception may be if you’re the at-fault driver and the accident results in severe injuries or a fatality. Otherwise, you’re looking at fines and a possible driver’s license suspension.

Don’t even consider driving if your license is suspended due to a lack of auto insurance, since you’re only making your legal situation worse. Your license may be suspended for years, and the financial penalties can be extensive.

Driving without insurance carries fines ranging from $500 to $1000, and your license may also be suspended for up to three months. Getting it back also comes with a $100 reinstatement fee.

Other Types of Car Insurance in Illinois

Even though Illinois only requires liability auto insurance, you may want to consider adding extra coverage. Even though the more insurance you have, the higher the price, it can end up saving you money if you’re in a vehicle accident.

Collision Insurance

Collision insurance covers any damage to your vehicle sustained in an accident; the accident can be with another vehicle or a stationary or fixed object like a fence or guard rail. This type of insurance doesn’t cover vehicle damage if it’s caused by an animal. For example, if you hit a deer, your collision insurance isn’t going to cover the damage.

Comprehensive Insurance

Comprehensive insurance is almost the same as collision insurance. The primary difference is your vehicle damage is covered if you hit an animal. Most drivers combine comprehensive and collision insurance, and sometimes you even get a better rate. Combined, the two policies are known as full auto coverage.

Gap Insurance

If you don’t own your vehicle outright, gap insurance is something to consider. Your vehicle’s value starts depreciating as soon as you drive it off the lot. 

Insurance only covers its blue book value if your vehicle is totaled in an accident. Often, this is less than what you still owe on the vehicle. Gap coverage takes care of the rest, so you’re not paying off a totaled vehicle.

Medical Payment Insurance

Medical payment insurance typically has a cap between $5,000 and $10,000. The insurance helps to cover additional medical expenses that may be left after your liability insurance hits its cap. Medical payment insurance also covers any injured passengers in your vehicle.

Roadside Assistance 

Yes, you can also carry roadside assistance coverage, which is great if your vehicle breaks down on the road. Try to think of roadside assistance as additional protection if something goes wrong with your vehicle.

Don’t Drive Without Insurance

While the monthly premiums of auto insurance may seem like an additional expense, the financial protection it offers in the event of an accident is invaluable and far outweighs the cost of the premiums. 

It’s important to remember that, beyond being a wise financial decision, carrying auto insurance is also a legal requirement in Illinois. Doing so not only safeguards you against the high costs associated with accidents but also ensures you comply with state laws, avoiding potential legal and financial penalties.

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