Iowa Auto Insurance Requirements
by Doug Cohen

Before shopping for car insurance, know what is required to operate a car in Iowa and what is not. Surprisingly, the Hawkeye State has no compulsory car insurance laws. Still, if you are involved in an accident causing damage over $1,000 and cannot immediately show proof of financial responsibility, your license will be suspended.

So what is considered Financial Responsibility in Iowa?Iowa state law says you can show proof of financial responsibility in one of these ways:

1. Show that you are covered by automobile liability insurance at the time of the accident;
2. Post cash, cashier's check, certified check, bank draft or postal money order payable to the Office of Driver Services;
3. Get releases from all other damaged or injured parties;
4. Obtain a decision resulting from a civil damage action relieving you of all liability;
5. File an agreement to pay the other damaged or injured parties on an installment plan;
6. Execute a warrant for confession of judgment which includes an agreement upon payment schedule;
7. File evidence of a complete settlement of all damages or injuries.

Whether you live in the capital city of Des Moines, Ames, Cedar Rapids or Cedar Falls, Davenport, Sioux City or Iowa City, Waterloo, Dubuque, or somewhere in between, financial responsibility in Iowa remains the same. Experts recommend simply buying and maintaining basic auto liability insurance or higher amounts if you can afford it, including uninsured motorist coverage, comprehensive and collision coverage (which covers damage to your car) , and medical payments insurance (for you and your passengers) although none of this is required.

Who Must Show Proof of the Car Insurance?

Both the car owners and drivers of the cars involved (if different) in an accident must prove their financial responsibility. This means if you owned the car involved in an accident but were not driving it at the time, you would still have to show financial responsibility by using one of the ways discussed above; otherwise you lose all your registrations. The driver of your car would also have to show financial responsibility or lose all Iowa licenses to operate cars.

Exceptions to Every Rule

Proof of financial responsibility after an accident is not a requirement in these cases:

• Your car was legally stopped, standing, or parked;
• Your vehicle was driven without your permission;
• No damage occurred to any person or property other than yourself.

Non-Iowa Resident Responsibility

Financial responsibility after an accident and future proof of rules apply to non-residents as well. Non-residents cannot operate or register any vehicle in Iowa until all requirements are met.

Proof of Insurance

Your Iowa auto insurance carrier should provide you with an ID card whenever they issue or renew your car insurance policy. You can also get an ID card or temporary proof of insurance for each car covered under your policy if you purchased your auto insurance from sites like InstantCarInsurance.com or Ensurance.com after comparison shopping online auto insurance rates. The advantage to these sites is you can print your own ID cards for free and do so online anytime, day or night, as opposed to waiting for the insurance company phone lines to open up.

The car insurance ID cards include the name of the car insurance company, the policy number, and the policy effective (and expiration) date. They also include a description of the insured car and the name of the primary insured driver.

Suspensions and Financial Responsibility

Any suspension as a result of moving convictions or revocation for OWI and implied consent (Chapter 321J) requires compliance with Iowa's financial responsibility law. This requirement is normally met by filing proof of at least $55,000 insurance coverage. Otherwise, you must post security of $55,000 by certified check, cashier's check, money order, or surety bond. This filing must be maintained for two years.

The moral of the story: Keep up to date proof of Iowa auto insurance ID cards in the car with you at all times.

How to Find the Best Auto Insurance Rates in Iowa

Everyone today boasts about having the lowest price on car insurance. That’s why it’s so important to comparison shop for the best coverage at the lowest rate, especially considering Iowa Auto Insurance is no longer so affordable. There are many basic online resources that provide free quotes from licensed Iowa insurance companies and are approved by the Iowa Office of Driver Services. If you suspect you may be paying too much for auto insurance, residents of Iowa can save time and money by comparing car insurance rates quickly and anonymously between top name Iowa auto insurance carriers simply by logging on to insurance aggregator sites like InstantCarInsurance.com rather than 15 different sites independently.

While the State of Iowa does not require auto insurance per se, keep in mind when shopping for basic coverage to evaluate it against car insurance quotes with higher coverage for a little more money. You may need it someday despite not being as cheap.

Money Saving Tip: Most people do not realize that insurance companies change rates continuously and typically re-post new rates twice monthly. Thus we recommend returning to InstantCarInsurance.com to re-rate your cars monthly to be sure you are still getting the best deal at the rock-bottom, lowest, cheapest price you can for auto insurance! Why not? It’s free.

At the same time keep in mind, the cheapest auto insurance is not always the best auto insurance. So it’s also a good idea to evaluate the number of complaints an insurance company has against them versus the number of cars they insure. Here’s a chart you might find informative.

CUSTOMER COMPLAINT RATIOS (for Selected Insurance Companies)
These complaint ratios are based on the number of written complaints received by the Insurance Division from January 1, 2006 to December 31, 2006 for the 11 insurance companies that write more than 95% of the private passenger automobile insurance market. These numbers do not reflect any determination on the part of the Insurance Division as to whether a particular complaint may have been justified or not and include no-fault hearing requests.
Insurance Company/Group	No. of Autos Insured	No. of Complaints Received	Ratio of Complaints per 1,000 Autos
American International (AIG)	110,338	58	0.526
Allstate Insurance	61,985	12	0.194
DTRIC Ins. Co., Ltd.	33,326	44	1.320
First Insurance	26,143	4	0.153
GEICO	176,497	108	0.612
Hartford Underwriters Ins.	37,645	12	0.319
Island/Tradewind Insurance Co.	35,172	8	0.227
Liberty Mutual Insurance Co.	32,800	50	1.524
Progressive Insurance Co.	37,355	20	0.535
State Farm Insurance Co.	130,778	17	0.130
USAA Insurance Co.	76,422	8	0.105

For more information contact: Iowa Motor Vehicle Division

MAILING ADDRESS
P.O. Box 9204
Des Moines, IA 50306-9204

ADDRESS
Iowa Motor Vehicle Division
6310 SE Convenience Blvd.
Ankeny, IA 50021

TELEPHONE
800-532-1121 - Toll-Free in Iowa
515-244-9124 - Local Des Moines
515-244-8725 - Local Des Moines