This article covers car insurance laws and regulations in North Carolina, and how those laws might affect a car accident case. We'll look at North Carolina’s “fault” auto insurance system and the kinds of coverage required under state law. If you’re looking for more general information on the legal rules related to auto accidents in North Carolina, you’ll find it in our companion article Car Accident Laws in North Carolina.
North Carolina is a "Fault" Car Insurance State
North Carolina adheres to a “fault” or tort-based system when it comes to determining how an injured party is made whole following a car accident. In a fault state, the person who was legally at-fault for the accident bears the liability (usually through his or her own car insurance carrier) for damages or injuries caused by the crash.
If you're involved in a car accident in North Carolina and you've been injured or had your vehicle damaged, you can usually seek compensation in one of three ways:
- file a claim with your own car insurance carrier (who will then seek reimbursement from the at-fault driver's insurer)
- file a personal injury lawsuit against the at-fault driver, or
- pursue a third party car insurance claim directly with the at-fault driver's insurance company.
Note: In contrast, in a no-fault car insurance system (which N.C. does not follow), an injured motorist must exhaust his or her own policy’s limits or reach a statutory threshold of damages before pursuing a claim against the other driver, without regard to who caused the accident. Legal remedies are also restricted in these states.
Minimum Car Insurance Requirements in North Carolina
North Carolina requires that the owner of a motor vehicle maintain a certain amount of liability insurance in order to operate the vehicle in the state. North Carolina’s minimum car insurance requirements are:
- $25,000 for the injury or death of a single person (yourself, a passenger, another driver, pedestrian, etc.)
- $60,000 total for all damages stemming from a single accident, and
- $25,000 for any property damage caused by the accident.
These are just the minimum amounts required under N.C. law. It may be a good idea to carry a car insurance policy with higher maximum coverage. That's because if you are found at fault for a car accident and the damages exceed the limits of your insurance policy, you may find yourself personally responsible for making up the difference out of your own assets.
Uninsured/Underinsured Motorist Coverage in N.C.
North Carolina requires that every car insurance policy sold in the state include uninsured motorist coverage. Underinsured motorist coverage may be required depending on how much coverage you carry under your policy.
Uninsured motorist coverage protects you from a situation where another driver is at-fault but he or she has no insurance. Underinsured motorist insurance kicks in to cover you when you're in an accident with an at-fault driver whose own insurance coverage is insufficient to pay for your damages caused by the crash. For example, if the other driver has the state minimum of $25,000 and your medical and rehabilitative costs are $35,000, then if you have sufficient UIM coverage it would pay the remaining $10,000.
For more information on Uninsured and Underinsured Motorist Insurance.
More Information on Car Insurance in North Carolina
For more information on North Carolina’s motor vehicle insurance requirements straight from the government, you can check out this page on driver's license requirements. from the North Carolina Division of Motor Vehicles.