Iowa Car Insurance Requirements (Updated for 2025)

Driving in Iowa requires proof of financial responsibility—typically via liability insurance. Failing to comply can result in fines, license/registration suspension, vehicle impoundment, and SR‑22 requirements.

Minimum Liability Coverage in Iowa

As of 2025, Iowa law requires:

• Bodily Injury Liability: $20,000 per person / $40,000 per accident
• Property Damage Liability: $15,000 per accident

Often referred to as “20/40/15” coverage.

Uninsured/Underinsured Motorist Coverage (UM/UIM)

Insurers must offer UM/UIM bodily injury coverage at limits of at least 20/40, but it is optional—you must reject it in writing if you decline it.

UM/UIM covers medical expenses and related costs if you’re hit by a driver who has no insurance or insufficient coverage. Property damage is not covered under UM in Iowa.

Optional Coverages to Consider

• Comprehensive Coverage (e.g. for hail, theft, natural disaster)
• Collision Coverage
• Medical Payments (MedPay)
• Uninsured Motorist Property Damage (UMPD)
• Rental Reimbursement
• Roadside Assistance

Proof of Insurance Requirements

Drivers must carry proof of insurance (physical or digital ID card). Law enforcement may request it during stops, and you have two days to present it—failure may result in fines, suspension, or impoundment.

Penalties for Driving Without Insurance

• Fine: Minimum $250
• License/Registration: May be suspended for up to 12 months
• Vehicle Impoundment: Possible until coverage is reinstated
• SR‑22 Requirement: Often required to regain driving privileges

No‑Fault vs. At‑Fault System

Iowa follows an at‑fault (tort) system. The at-fault driver is responsible for damages. The state uses modified comparative negligence—must be more than 50% at fault to recover damages.

Alternative Proof of Financial Responsibility

In rare cases, you could post a cash bond or deposit instead of insurance—but most drivers use a standard liability policy.

Liability Limit Advice

While 20/40/15 meets legal minimums, serious accidents can easily exceed these limits. Many financial experts recommend higher coverage—e.g. 100/300—for better protection.

Compare Auto Insurance Quotes in Iowa

Average annual premiums for minimum liability coverage are around $260; full coverage averages $1,630. Premiums vary by city, driving history, age, and coverage level—so comparing quotes is wise.

🔍 Start Comparing Iowa Car Insurance Quotes →

FAQs

Is Iowa a no‑fault state?

No. Iowa uses an at‑fault liability system.

Is UM/UIM coverage mandatory?

No—but insurers must offer UM/UIM at 20/40 limits; you can decline it in writing.

Is PIP available?

No—Personal Injury Protection is not available. MedPay may be offered as an alternative.

What is an SR‑22?

An SR‑22 is a certificate of financial responsibility filed by your insurer, often required to reinstate driving privileges after suspension.