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Overpaying on car insurance?

Colorado Car Insurance Laws

colorado car insurance laws
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When you drive in the Centennial State, you must maintain auto insurance coverage on your vehicle. The state of Colorado has laws in effect that mandate the coverage minimums for all drivers, regardless of how many miles they drive on average. Understanding Colorado car insurance laws and how to get affordable coverage can help you avoid costly penalties while keeping yourself and others around you safe. Learn more about the laws that apply to drivers, along with cheap insurance policy options offered in the state.

Mandatory Vehicle Coverage in Colorado

Every driver operating their vehicle in the state of Colorado must have liability coverage, which covers property damage and bodily injury. If the driver of a vehicle is found to be at fault for an accident, their liability coverage would apply to any damages sustained to the other involved parties’ vehicles and/or property. This coverage would also cover the treatment needed for any injuries sustained during the collision by people outside your vehicle.

The state requires drivers to maintain at least the following liability coverage amounts:

  • $25,000 bodily injury, per individual
  • $50,000 bodily injury, per accident
  • $15,000 property damage, per accident

Although these are the minimum coverage amounts required in the state of Colorado, many drivers choose to purchase insurance coverage in excess of these state-mandated minimums. Once the coverage limits have been exhausted, the policyholder becomes personally responsible for any additional damages incurred in the collision. Additionally, liability insurance only pays for damages caused to the property of other parties. It doesn’t cover the insured vehicle on the policy or injuries to the driver.

Collision Coverage

To protect your own vehicle, it’s important to maintain collision coverage on your insurance policy. This type of coverage pays for damages caused to your vehicle if you get in a crash with another vehicle. The state of Colorado doesn’t mandate collision coverage, but failing to have it on your policy could be disastrous, especially if your vehicle sustains massive damage during a collision in which you’re found to be at fault.

Comprehensive Coverage

Comprehensive auto insurance is a separate coverage option that helps you pay for damage to your vehicle caused by something other than a collision. Examples of situations in which comprehensive coverage might apply include:

  • Theft
  • Glass damage
  • Vandalism
  • Weather events
  • Fire
  • Flooding

If your car is valuable, you may want to consider adding comprehensive coverage to your plan.

Uninsured/Underinsured Motorist Coverage

Although some states require drivers to include uninsured/underinsured motorist coverage on their policies, this type of coverage is optional for drivers in Colorado. Uninsured/underinsured motorist coverage pays for any damages and/or injuries caused by a hit-and-run driver or a driver who doesn’t have sufficient insurance coverage to pay for your injuries or repairs to your car.

Penalties for Uninsured Drivers in Colorado

State law requires every driver in Colorado to maintain sufficient insurance coverage on their vehicle and carry proof of that insurance coverage when driving. If you can’t show proof of insurance to a law enforcement officer, you may be subject to a $500-$1,000 fine and the suspension of your driver’s license. On the first offense, your license will be reinstated when you can show proof of insurance.

After the first offense, failing to produce proof of insurance coverage may subject a driver to a fine of at least $1,000 and a suspension of the license for four months. A judge can also order an uninsured driver to complete up to 40 hours of community service. After a license has been suspended, the driver must pay $40 to reinstate their license and file an SR-22, which is a proof of liability insurance form. This form must be maintained for three years.

If a driver in the state of Colorado changes their insurance policy or provider, they have 10 days to report the change to the state. The state of Colorado maintains these records in an electronic database.

Comparing Auto Insurance Companies in Colorado

Many major auto insurance companies offer coverage to drivers located throughout the state of Colorado. Certain factors impact rates and coverage options, including:

  • Coverage amounts
  • Driving record
  • Age of policyholder (and those covered on the plan)
  • High-risk violations
  • Make and model of vehicle
  • Credit history
  • Gender
  • Marital status
  • Zip code

Although some of these factors are within your control, such as your driving record, credit history, and the type of vehicle you drive, others are outside your control. The age of a driver can affect the rate for which they qualify by up to 367%. Younger drivers and elderly drivers typically have the highest rates, as those under 25 are considered to be less experienced, while those over the age of 65 are statistically more likely to get into accidents and sustain injuries.

Cheapest Car Insurance in Colorado

According to NerdWallet, American National is the most affordable insurer in the state of Colorado. For full coverage, this company charges an average of $63 per month for drivers who are over the age of 25 and have good credit and a good driving record. For minimum coverage, the average rate for Colorado drivers is $16 per month. This company also offers the lowest average prices for young drivers, charging $119 per month on average.

If you have poor credit, you may want to consider getting insurance coverage through GEICO. This national insurance company charges an average of $63 per month for drivers who are at least 25 years old but have bad credit. GEICO also came in second on NerdWallet’s list of cheap options for young drivers, charging an average of $127 per month for 20-year-olds. Drivers who can’t qualify for traditional auto insurance coverage may qualify for the Colorado Motor Vehicle Insurance Plan.

Protecting yourself, your vehicle, and other drivers on the road is essential when you get behind the wheel. With the right insurance coverage, you can reduce your financial liability in the event of a crash with another driver. Make sure to maintain sufficient coverage that meets or exceeds the state minimums.

FIXD Research Team

At FIXD, our mission is to make car ownership as simple, easy, and affordable as possible. Our research team utilizes the latest automotive data and insights to create tools and resources that help drivers get peace of mind and save money over the life of their car.

We’re here to help you simplify car care and save, so this post may contain affiliate links to help you do just that. If you click on a link and take action, we may earn a commission. However, the analysis and opinions expressed are our own.

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About the Author

FIXD Research Team

FIXD Research Team

At FIXD, our mission is to make car ownership as simple, easy, and affordable as possible. Our research team utilizes the latest automotive data and insights to create tools and resources that help drivers get peace of mind and save money over the life of their car.

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