Is Property Damage Liability Required in Every State?

Laws differ from state-to-state, even when it comes to auto insurance.

The laws of minimum insurance policy and coverage varies throughout the nation and it applies to many types of insurance such as health insurance and auto insurance coverage. Because of that difference, not all states require property damage liability.

What is property damage liability

Property damage liability coverage addresses the costs of damages to the other driver’s vehicle or property should you be involved and found at-fault for an auto accident. Commonly, property damage liability insurance also covers the damage caused by other authorized drivers of your vehicle. As of the publishing of this article, states that do not require property damage liability clauses in their auto insurance police includeCalifornia,New Hampshire,Tennessee andWisconsin.

The states that typically do not make property damage liability mandatory have other policies in place to ensure that debts you incur because of your driving are still your financial responsibility. Some provisions required by the states in lieu of property damage liability insurance are:


  • Motor vehicle or automobile liability insurance policy coverage
  • A self-insurance certificate issued through the DMV
  • $35,000 cash deposit to theDepartment of Motor Vehicles (DMV)
  • A California-issued insurance company licensed surety bond for $35,000

New Hampshire

  • A $75,000 single limit policy will require the total coverage required by law
  • New Hampshire’s Financial Responsibility requirement must be met


  • Motor vehicle or automobile liability insurance company coverage is required
  • $60,000 cash deposit or bond held at the Department of Safety
  • Self-insurance certificate


  • Motor vehicle or automobile liability insurance company coverage is required
  • $60,000 cash deposit to the Department of Motor Vehicles (DMV)
  • A Wisconsin-issued insurance company licensed surety bond for $60,000

Despite not all states requiring property damage liability insurance, they still legally mandate certain types of financial responsibility to those who drive. Many times property damage liability insurance is still available in the states not legally requiring this type of coverage and may be worth adding to your auto insurance policy because of the benefits provided by property damage liability insurance.