What Insurance Is Required by Law?

To the average consumer, there are a lot of different insurance coverages available. Insurance carriers provide policies for health insurance, automobile insurance, home insurance, life insurance and more. With so many options available, it can be confusing to consumers. Here are the types of insurance coverages that are required by law and those that are optional.

Health Insurance

Contrary to popular belief, it is not a law to have health insurance coverage. This was required by the government during the Obama administration but has since been changed to not be a required type of insurance. For this reason, and for those who cannot afford health insurance premiums, there are several government-backed programs available under the affordable care act. You’re encouraged to have health insurance for you and your family, but it is not required by law.

Auto Insurance

Unlike health insurance, automobile insurance is required by law and you can be fined and/or jailed if you do not have proper coverage for your vehicle. Because you are driving on a shared space with other individuals and could put other lives at risk, you are required to have this type of insurance for any vehicle you operate. Should you be pulled over without auto insurance coverage, you will face legal consequences and steep fines. Additionally, the law enforcement officer may revoke your driver’s license.

Life Insurance

Life insurance is a type of coverage that passes on benefits to your family and children. It is an optional type of insurance and is not required by law. Most individuals with a life insurance policy receive this type of insurance through their employer or purchase it outright through an independent insurance provider. Life insurance premiums range in monthly cost depending on the amount of coverage you would for your family. Coverages can range anywhere from $50,000 to over a million dollars.

Homeowners Insurance

A homeowner’s policy is a type of insurance that is not required by law, but is strongly encouraged by anyone who owns real estate. This type of insurance protects your investment in the event of natural disasters and common things that happen to a home over time. Although not required by the law, some homeowner insurance policies may be required the homeowner’s mortgage company as part of the lending procedure. Be sure to check with your mortgage company to know for sure if you should have this type of insurance.

In addition to a homeowner policy, individuals may purchase renter’s insurance or mobile home insurance. These policies have similar coverage as a standard homeowner policy, but are slightly different.

Questions About Your insurnace?

As you can see from these 4 basic categories of insurance, there are many options available to you. It’s best to check with your insurance provider to understand your coverages, monthly premiums and other types of insurance you might want. Whether you work with a large company like State Farm, AllState or a local insurance provider, they will be able to answer any questions you come across with your policies.


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