Verified April 2026
Car Insurance Law Changes 2025-2026: What Drivers Need to Know
Four states raised minimum liability limits in 2025 (California, North Carolina, Utah, Virginia) and New Jersey made a major change effective January 1, 2026. Here is what changed, the legislation behind it, and what it means for your premium.
2025 Changes
California's previous 15/30/5 minimum had been in place since 1967 and was widely considered dangerously insufficient. The $5,000 property damage limit was lower than the cost of most fender-benders. The new 30/60/15 is still below what most financial advisors recommend but is a meaningful step. Drivers who were previously at 15/30/5 state minimum needed to update their policies by January 1, 2025. Expected premium impact for minimum-coverage drivers: 10-20% increase.
Source: California DOI, California Legislative Information (SB 1107, Ch. 648)
NC did not raise its minimum liability limits in 2025 but clarified the UM/UIM stacking rules -- specifically, how uninsured-motorist coverage stacks across multiple vehicles on a policy. The clarification affects how carriers calculate UM limits for households with multiple vehicles. NC's Reinsurance Facility (NCRF) continues to provide a competitive backstop for high-risk drivers.
Source: NC DOI 2025 consumer bulletin
Utah raised the per-person bodily injury minimum from $25,000 to $30,000. The per-accident ($65K) and property damage ($15K) limits were unchanged. Utah is a no-fault state requiring PIP, so these minimum limits apply on top of the mandatory PIP structure. Impact on minimum-coverage premiums: modest (5-10% on the liability component).
Source: Utah DOI, Utah Legislature HB 331
Virginia raised its minimum bodily injury limits from 25/50/20 to 30/60/20. The property damage limit ($20K) was unchanged. Virginia also allows drivers to pay an uninsured motor vehicle fee ($500/year) instead of purchasing insurance -- a unique approach that is expected to be reviewed in 2026. Drivers who previously held state-minimum policies needed to update coverage by January 2025.
Source: Virginia DOI, DMVNOW.virginia.gov
2026 Changes
New Jersey's previous 15/30/5 minimum had been among the lowest in the country and was widely criticised by consumer advocates. The new 35/70/25 structure is a significant increase -- particularly the property damage jump from $5,000 to $25,000, which better reflects the cost of vehicle damage. NJ is a choice no-fault state with mandatory PIP. Drivers who were at the old minimum needed to update their coverage by January 1, 2026. Expected premium impact for minimum-coverage drivers: 20-35% increase on the minimum-coverage tier.
Source: NJ DOI, New Jersey Legislature L. 2024 c. 128
Texas raised minimum limits in 2021 (from 30/60/25 to the current 30/60/25) and confirmed those limits through 2026 legislative session. No further increases are pending as of April 2026. Texas DOI is monitoring pending federal minimum-coverage guidance.
Source: Texas TDI consumer bulletin, Texas Legislature Online