Tennessee Car Insurance Laws

One of the great truths in life is that all drivers need insurance, but the laws regulating car insurance vary from state to state. Keeping up with state auto insurance legislation is the responsibility of the individual driver. Ignorance of the law is no excuse. Tennessee, with its millions of licensed drivers, is no exception. Enter your ZIP code into our FREE car insurance comparison tool to find good rate quotes for you now!

Pay Now or Pay Later – Big Time

At one time car insurance was not required in Tennessee, as long as the driver was able to prove they had the financial means to pay for damages in an accident. But that changed, and current laws are designed to protect drivers who were hit by an uninsured driver. Check out our list of the top ten cars to make sure you’re getting the best car to have insurance on. One of the requirements is to have liability insurance.

• Drivers need not carry Personal Injury or Uninsured Motorist coverage, but they must at least have 205010 liability coverage. That means motorists in Tennessee should purchase $20,000 worth of liability coverage with a payout amount of $50,000 per accident. The $10,000 clause is the highest amount the driver at fault will pay for damages incurred.
• Under state law, drivers who decline to buy 205010 insurance must provide a bond or some other assurance that they are financially able to pay for damages. This type of proof is not required at the time the car is registered, but in case of an accident a driver unable to provide it will face harsh penalties.
• Tennessee requires drivers buying liability insurance to have an SR-22 form, which is a certified statement that the driver has bought this type of insurance. If the individual has lost his license this form is required to reinstate it when the driver did not pay the monetary fee the court called for in an accident judgment, the individual failed to maintain the legally required proof of financial responsibility, the driver’s license was previously suspended for incurring too many points, the license was suspended due to a DUI charge.

Drivers are also not required to purchase uninsured driver/underinsured driver coverage. But because Tennessee is a Tort state, insurers advise drivers to carry more coverage than just the minimum state requires.

Tort State

In a Tort state, the law automatically holds one driver liable for an accident, and that driver’s insurance company pays for the damages and medical bills. This is the opposite of no-fault insurance which is in effect in some other states.

Just like in other jurisdictions, when police stop drivers in Tennessee those who fail to show proof of insurance face heavy fines and maybe even have their license revoked. The car might be impounded, and a jail sentence is also a real possibility. Rather than risk the chances of that happening most drivers play it safe and purchase insurance.

Car Rental Companies Also Fall Under the Law

The guidelines for renting a car when on vacation are the same as when driving your own personal vehicle. Rental cars are required to carry the minimum amount of liability insurance, although the majority of insurance policies extend coverage to renting a car. Most major credit cards cover car rentals, but to be sure check with the bank that issued the card as well as the auto rental agency. If neither party offers this option, you’ll need to pony up the money yourself. It usually costs between $7 and $14 a day.

Insurance Premiums Don’t Tell the Whole Story

Most drivers think their insurance premiums are high, but a study done in 2004 showed that auto insurance premiums in Tennessee averaged $666.22, the 10th lowest in the nation. That was despite the fact that many drivers were in what insurance companies call high-risk categories:

• The state still had a 70 mph speed limit.
• Cell phone usage while driving had not been made illegal.
• The legal level for blood alcohol content was 0.08 percent and open liquor containers in the car were still permitted.

New legislation has been enacted since then, but human nature being what it is, driving habits take time to change. It is still permissible to use a cell phone in the car, but in 2009 Tennessee passed legislation banning texting while driving.

• Nationally almost 50 percent of teens admitted to texting while they drove, and Tennessee was one of the first states to take the initiative to ban texting while behind the wheel.
• Currently drivers in Tennessee who are caught texting while driving will not have any points added to their license but they will be slapped with a $50 fine.

The Policyholder Can Choose Who Gets Insurance Protection

A quirk in the auto insurance laws is the option for a policyholder to have special clauses excluding anyone they wish from coverage. In Tennessee it’s permitted to exclude a household member from coverage if they are considered a high-risk driver. A policy written this way will list the specific exclusions in one particular section. This makes it twice as important to understand the contract’s fine print.

The State Puts Teeth in Its Car Insurance Laws

Letting your insurance coverage lapse in Tennessee is not a good idea. The law sees that as the same as uninsured driving, which draws a misdemeanor charge, a $100 fine and a temporary license suspension. That triggers off a chain reaction.

A suspended driver’s license can lead to the authorities placing a “Stop” on the car’s registration until the driver pays what is owed to renew the insurance.

The driver won’t be allowed to renew their registration until all other fees and regulations are taken care of.

Find Car Insurance to Fit Your Budget and Driving Needs

Auto insurance rates in Tennessee vary based on the city. For example, a driver in Memphis, Knoxville or Nashville may pay different rates than one in Chattanooga, McMinnville, or Murfreesboro. Our FREE auto insurance comparison tool can use your ZIP code to help find accurate quotes for you!

Other factors affecting insurance rates include the number of miles commuted to work or school, the make, model and year of the vehicle, age, gender and driving history. Enter your ZIP code online today for FREE car insurance quotes and begin shopping for the insurance agent who can get you the best deal on affordable auto insurance.