Life in Tennessee is a mix of urban life and nature. Bustling streets, mountains, heavy traffic, all sounds pleasant, but the freedom of driving anywhere at any time is a privilege that comes with a huge responsibility.
Tennessee law requires every driver to carry minimum auto insurance. Insurance is mandatory in every state since it covers injuries and property damage in case of an incident.
Driving Legally in Tennessee: Insurance Requirements Explained
Tennessee law mandates that all drivers have their liability coverage in order to drive legally. This showcases a driver’s responsibility behind the wheel and towards the citizens of the state. Listed below are the minimum liability coverage limits required by Tennessee law.
Minimum Liability Coverage
These limits are also known as 25/50/25. Driving without insurance is risky and can result in fines and, in extreme cases, a license suspension.
- $25,000 medical injury per person
- $50,000 per accident (if multiple people are injured)
- $25,000 property damage
Always Keep Proof of Insurance
Individuals on the road must carry valid proof of their insurance, either on paper or electronically. Any law enforcement agent can require you to present your papers when required. Since 2016, Tennessee has used an electronic insurance verification system to track the records of drivers. Being uninsured can mean fines, suspension, or vehicle impoundment.
Tennessee’s Fault-Based Insurance System
Unlike Florida, Tennessee operates under a fault system, meaning the driver at fault has to bear and pay for the damages. Having liability insurance in Tennessee can cover bodily injuries and property damages caused up to your policy limit, without any cost to you.
Liability Insurance Coverage
There are two types of liability required by state law.
- Bodily Injury Liability: If you’re found at fault in an accident, this liability would cover medical costs, lost wages, mental health damages, etc.
- Property Damage Liability: Any damage to other persons' property, like their car, home, or fence, caused by you (intentionally or unintentionally) will be repaired under this liability.
These minimums are for your own safety. They protect you from paying money out of pocket when you’re declared at-fault in an accident.
Modern medical expenses can easily exceed the $25,000 bodily injury cap, and car repairs can often cross the $25,000 mark. In this case, you would have to pay the difference yourself. Since this is the minimum requirement required by state law, financial experts recommend that you always choose high coverage options.
Alternatives to Standard Insurance Coverage
A NerdWallet review, published in 2015, notes that Tennessee is one of the states offering alternatives to auto insurance. Listed below are two legal alternatives to standard car insurance in Tennessee.
Cash Deposit Option
You can deposit $65,000 in cash or high-grade securities with the Tennessee Department of Revenue. At first, the deposited money needs to be accepted to ensure you don’t have any outstanding judgments related to car accidents connected with you. If all goes well, you will receive official proof of financial responsibility, valid for one year. This option allows you to drive uninsured, backed by your own funds.
Who it protects: Covers the third party or accident victim.
Benefit: If you have excess assets and don’t want to waste money on insurance costs, self-insurance is the way to go. There is also no risk of cancellation or SR‑22 filings. You’re legally covered up to $65,000 per incident involving injury and damage. You only pay money out of your pocket if there is an accident, and the total expense surpasses the $65,000 limit.
Surety Bond Route
In simple words, a surety bond is a three-party agreement in which you purchase a $65,000 surety or a licensed bond issued by a Tennessee-licensed surety company. This bond guarantees that if, in any case, you’re found guilty or at fault in an accident, your surety company will pay up to $65,000 on your behalf. However, you will be responsible for reimbursing the total cost, including the legal costs to the surety company. To keep this insurance working, you need to pay an annual premium of 2-5% of the $65,000 bond (which makes it $1,300–$3,250 per year).
Who it protects: Covers the third party or accident victim.
Benefit: This is also a rare type of insurance, but in this case, there is no large upfront payment or deposit. Beneficial for owners who prefer self-insurance.
If you also struggle to obtain coverage due to DUI or multiple violations, these insurances might be your best shot at securing it. If you maintain it properly for some years and keep your record clean, you can prove to insurers that you’re a low-risk driver.
Optional and Recommended Coverages
Every state in the U.S. has its minimum liability requirements, but any smart person would know this is not enough in case a major mishap or accident happens. Listed below are some of the options for recommended coverages in Tennessee.
Collision Coverage
Repairs or replaces your vehicle after any accident involving hitting a car, roadside objects, or is even applicable for hit-and-run scenarios. This type of insurance usually involves a deductible where you pay first, and your insurer covers the rest.
Quick take: If you drive in high-traffic or urban areas, it’s recommended to get this coverage.
Comprehensive Coverage
This type of coverage covers non-collision damage to your car, for example, theft, vandalism, damage to the car caused by harsh weather, or accidents involving animals. It also covers damages caused by tree branches. Comprehensive coverage is slightly cheaper than collision coverage.
Quick take: If you drive in rural/scenic areas, it’s recommended to get this coverage.
Uninsured/Underinsured Motorist Coverage (UM/UIM)
If a driver with no insurance accidentally hits your vehicle, the uninsured coverage covers your medical bills and lost wages. However, if the accident involves an underinsured at-fault driver, your UIM coverage will pay the remaining amount up to your policy limits.
Medical Payments Coverage (MedPay)
Covers medical bills (e.g., doctors, ER fees, ambulance rides) and funeral expenses involving you, the passengers, or your family affected in the incident, regardless of who was at fault. It’s like an extended layer of protection alongside your health insurance.
Rental Reimbursement & Roadside Assistance
Covers rental car cost or alternative transport if your vehicle is being repaired after an accident, no matter who was at fault. Emergency assistance includes services such as jump-starts, towing, or emergency fuel delivery if your car breaks down unexpectedly.
First Accident Rate Protection
After your first at-fault accident, insurance companies might see you as a threat and increase your insurance rates. However, some companies like Nationwide and Farmers prevent your insurance rates from increasing after minor at-fault crashes.
Which Collision Coverage Costs More Fixing collision damage is expensive, which is why collision coverage is slightly higher than comprehensive coverage.
Rule of thumb: If your car is old or has a low market value, paying for these premium options may not be worth it.
SR-22 and Car Insurance Requirements
SR-22 isn’t actually insurance, but a certificate filed with the Tennessee Department of Safety and Homeland Security. Listed below are the conditions under which you may have to file an SR-22 in Tennessee.
Who Needs an SR‑22?
Your insurer will file an SR-22 on your behalf. However, SR‑22 is needed in certain conditions if you’ve
- Convicted of DUI or driving under the influence, or DWI driving without insurance
- Been involved in an accident without insurance
- Gathered too many points/convictions
- Driven under the influence of methamphetamine
- Left the scene of an accident, involving a hit-and-run (committed injury or death)
- Found guilty of reckless driving, or refused a required alcohol test
Insurance Requirements
If you’re required to get an SR-22, you will officially be notified either by the court or the Tennessee Department of Safety. This extra requirement often comes with your license suspension or revocation notice.
Once mandated, inform your insurance company that you require SR22 as soon as possible. If by any chance you’re underinsured, you’ll need to purchase the minimum liability coverage through a company. This includes $25,000 bodily injury per person, $50,000 per accident, and $25,000 property damage per accident. Your insurer files the SR‑22 form electronically and charges a one-time fee from you, often around $15-$35.
Cost & Impact
The filing fee is not expensive, but the auto insurance premium increases since now you’re a high-risk driver. According to an article published on MoneyGeeks, SR-22 drivers often pay double rates or 80-90% more than drivers with clean records.
Typical monthly premiums in Tennessee
- Minimum coverage: $72/month ($860/year)
- Full coverage: $171/month ($2,056/year)
In Tennessee, you need to maintain your SR-22 certificate for up to 3-5 years, or for the entire duration of your license suspension. Only after completing the required period can you request a cancellation. If your SR‑22 insurance policy is canceled, then you have 20 days to re-file a new SR‑22, or you can face license suspension again.
Tennessee Car Insurance Laws: Penalties and Fines
Tennessee, like any other state in the U.S., takes its auto insurance requirements very seriously. Not abiding by the rules and failing to comply with auto insurance requirements can carry a lot of consequences, including financial penalties. Listed below are some of the major consequences you could face if you’re caught without a valid vehicle insurance policy.
Failure to Provide Proof of Insurance
If you don’t have any proof of insurance when stopped by a law enforcement officer, you face a Class C misdemeanor for a first offense. You can get a penalty up to a $300 fine, loss of driving privileges, and the possibility of retaking your driver’s exam.
Causing Injury/Death
If you’re caught in an incident with injury and death and without insurance, you face a class A misdemeanor. The penalty is up to $2,500 and up to 12 months in Jail. You will also be personally liable for medical damage costs.
SR‑22 and Reinstatement Requirements
After most insured accidents, you will be required to file an SR-22, which stays on your file for up to 3-5 years. If you miss a payment of premiums or forget to renew, in this case, policy lapse may occur, and it might trigger another suspension.
Tips for Finding Affordable Car Insurance in Tennessee
Here’s the truth: your Tennessee car insurance rates aren’t fixed forever. They’re influenced by the wrong and the good choices you make. If you prove to be a good driver, you can make your insurance rates fairly lower. The same applies in the opposite case.
Meanwhile, the Consumer Federation of America says that drivers who shop around annually can save hundreds each year. Listed below are some tips to help you get the best insurance premium.
Best Rates for Insurance in Tennessee
Don’t assume your current insurer is offering you the best premium, even if they say so. Your car insurance can highly depend on your car model. Also, according to MoneyGeeks, shopping around can save $200 to $800 annually, while bundling home and auto insurance provides 15% to 25% discounts, potentially saving up to $900 annually.
Increase Your Deductible
Common choices for deductibles are $250, $500, or $1,000. You can always adjust your deductibles to balance premiums. Raising the collision or comprehensive deductible to $500 or $100 can reduce your monthly premiums. However, you must ensure you have enough savings to cover what’s needed.
Ask About Car Insurance Discounts
If you’re a safe driver and have low mileage, insurers might offer you a discount on your premium. Like progressive snapshot has a telemetry program that rewards excellent driving, including safe acceleration and braking.
Clean Driving Record + Good Credit Score = Big Savings
If you have a clean driving record and credit score, expect better rates from insurers. Shop around and see what they offer. Compare the options and go with the one that provides the most discount and savings.
At‑Fault vs. No‑Fault Insurance: What’s the Difference?
Tennessee is an at-fault state, which means that the driver who caused the accident is 100% financially responsible for the injured party’s medical bills and property damage. In this case, injured parties can file a claim against the at-fault driver’s insurer and even sue for strict damages. In Tennessee, you require a minimum liability of 25/50/25 to drive on the road legally. However, UM/UIM is optional but recommended.
However, for no-fault states, each driver’s own policy covered their medical expenses, using Personal Injury Protection (PIP) regardless of who was at fault. With Personal Injury Protection (PIP), individuals can get faster medical payouts while the fault of the accident is being investigated.
Best Practices
The golden rule: always drive carefully and have the right documents. If you think your insurance is offering expensive rates, look for other options that fit your budget and needs. But having the right insurance and being covered can save you from serious violations and lifelong financial stress.
Having a good credit score and driving record goes a long way in getting discounts and lower premiums.
Speak with an Insurance Navy agent today to see how much you could save. Insurance Navy helps drivers find the best, affordable car insurance tailored to their vehicle, driving history, and local conditions.
Request a free quote today, online or by phone at 888‑949‑6289. Prefer face-to-face? Visit one of our many storefronts, and get driving insurance tomorrow.
Frequently Asked Questions
Listed below are answers to some of the most frequently asked questions about auto insurance requirements in Tennessee.
What should I do if my coverage lapsed?
Tennessee’s electronic verification system uses an advanced method, and in any case, if your policy lapses, the system will flag you immediately. If on-the-spot action is not taken, you could face fines and suspension.
What’s the difference between a first-party and third-party claim?
First-party claims generally mean you file a claim with your own insurer, and third-party claims mean somebody else did it for you. An example of first-party claims would be when you file a claim with your insurance company to cover your own losses. A third-party claim would mean somebody else files a claim against the at-fault driver’s insurance company.
Can I still file a claim if the other driver’s insurance denies it?
If you were involved in an accident and your at-fault driver denies or claims, or is underinsured, your UM/UIM coverage can be claimed only if you have purchased it before.
How do I get an SR‑22?
You will know if you’re legally required to get an SR‑22. Take this request to your insurer, who will file the SR‑22 electronically with the Tennessee Department of Safety. There is usually a filing fee. Before you start driving on the road, ask if your SR-22 is accepted, or you might risk your license suspension again.
What are some Tennessee auto insurance requirements (and teen discounts)?
Tennessee law requires all drivers to carry liability insurance in order to legally drive a vehicle.
However, if you are a teen and recently got a driver’s license in Tennessee, you may be eligible for a good student discount, which can offer savings up to 25% and may apply until age 21–25. You might also be eligible for low-mileage or family policy discounts.
