Arizona Car Insurance Laws (Updated 2022)

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By Ross Martin

Updated January 5, 2022

Edited By Renata Balasco

Auto insurance requirements in Arizona

The state of Arizona requires proof of insurance before you can register a vehicle. Every driver must have at least the minimum amount of liability coverage and must also carry proof of insurance while driving. This can also be referred to as your proof of financial responsibility.

See below the minimum amounts of car insurance coverage that drivers are required to carry in Arizona.¹

ARIZONA INSURANCE MINIMUMS

Minimum Liability Coverage: 25/50/15
$25,000 for bodily injury per person $50,000 for bodily injury per accident $15,000 for property damage per accident

Arizona is a comparative fault state

Comparative fault — also known as comparative negligence — is a process in way of assigning fault in which the at-fault driver is responsible for paying for damages to others.

Arizona is a “pure” comparative fault state,² meaning this responsibility can be shared if it is found that both drivers share in the fault. It can be split by percentages. If one party is found to be 75% at fault, their insurance company would pay a proportional amount, while the other party’s insurer would be responsible for the remaining 25%.

Liability coverage in Arizona

If you cause an accident, liability insurance covers those injured or who suffer damages. Liability insurance never covers your injuries or damages to your property. It pays the other driver only.

Liability insurance is separated out between bodily injury coverage and property damage. Bodily injury liability covers injuries caused by the at-fault driver, while property damage liability goes toward paying for personal property destroyed or damaged by the at-fault party.

What are state-mandated car insurance limits?

Almost every state requires a certain amount of insurance. The lowest amount you can carry and still legally drive is often referred to as the limit. Such limits can usually be increased for a small increase in rates, which is highly encouraged.

The state of Arizona requires every driver to maintain a minimum amount of liability insurance in the amounts listed above. You’ll often see this written out as 25/50/15. This is known as a split limit as it lists the limits of three separate coverage types. These coverage types are per person, per accident, and property damage.

Per person is the amount that will cover any single person injured in a car accident you cause. It will cover multiple people up to the “per accident” limit.
The per accident limit applies if you injure more than one person in the same accident. It is the total amount that your insurance company will cover for bodily injuries you cause in any one accident. This limit is the total amount that your insurance company will pay, though never paying over the “per person” limit for any one person.
Property damage per accident is the total dollar amount that an insurance company will cover for damages to another’s property caused by you.

Do Arizona’s required minimums provide enough coverage?

Arizona’s car insurance minimums are quite low. For this reason, it’s highly recommended that drivers obtain coverage above the state-mandated limits. With minimum coverage limits this low, it’s highly unlikely that these will adequately cover most costs. Low coverage limits can leave you at risk of having to cover the remainder of these costs out of pocket.

For example, if you cause an accident that results in $35,000 in injuries for the other driver, your liability coverage would only pay $25,000 for that person’s injuries, even though your per accident limit is $50,000. Liability limits in Arizona can run out rather quickly. This is especially true for property damage coverage. A minimum coverage amount of $15,000 doesn’t come close to covering the cost of most new vehicles, which average anywhere from $25 - 30,000. Arizona’s property damage liability limit would certainly fall short of covering the cost of a high-end or luxury vehicle.

Arizona's penalties for driving without proof of insurance

Drivers who operate a motor vehicle without the proper auto insurance coverage can face steep penalties, including the loss of driving privileges.¹

The penalty for failure to show proof of insurance in Arizona is as follows.

	Fine	Other Penalties
1st offense	$500	Drivers license and registration suspended for three months. SR-22 required for two years.
2nd offense	$750	Drivers license and registration suspended for six months. SR-22 required for two years.
3rd offense	$1,000	Drivers license and registration suspended for one year. SR-22 required for two years.

Of course, the fines listed above are small in comparison to the damages you could be held responsible for if you cause an accident while driving without insurance in Arizona.

Optional car insurance coverage in Arizona

Arizona law only requires that you carry liability insurance in the amounts listed above. However, the following coverages are great add-ons to your insurance policy if you are looking for more coverage.

Collision: This coverage steps in to cover your vehicle if you are involved in a collision with another driver or object (aside from animals).
Comprehensive: Comprehensive insurance protects your vehicle against non-collision damages. This includes perils like theft, weather damage, and hitting an animal. Comprehensive and collision coverage — when purchased together — are typically referred to as “full coverage.” Sometimes, a lien-holder or bank can require full coverage if you are financing the vehicle.
Roadside assistance: This coverage helps you in the event of a breakdown. The particulars of the coverage vary by company, but roadside assistance typically covers battery jumps, flat-tire fixes, and the cost of a tow to a nearby garage as well as some other perks.
Medical payments: This covers medical and funeral costs for you and your passengers up to a specified amount.
Uninsured motorist coverage: As the name would imply, this coverage covers you in the event you are hit by a motorist who does not carry liability insurance. While the at-fault driver is still on the hook for any medical bills to you or your passengers, uninsured motorist coverage exists in case they are not able to pay them right away.³

What is an ADOT code?

The Arizona Department of Transportation assigns special codes based on the insurer and level of coverage that you choose. You will only have an ADOT code if you are a resident of Arizona. This code can often be found on your insurance card. Similarly, you can contact your insurance company to find the code.

Arizona is a diminished value state

Arizona is a diminished value state, meaning drivers are allowed to recover diminished value from the at-fault party’s insurance company. When your vehicle experiences an accident, even if it is fully repaired to its pre-loss condition, the resale value decreases. The involvement in a collision makes your car’s value lesser than similar vehicles that have not experienced an accident. A diminished value claim allows you to recoup the losses you might experience when selling your car.

Since Arizona is one of the 15 states that offers compensation for diminution in value, you may file by contacting the at-fault party’s insurer. In order to file a diminished value claim in Arizona, certain requirements must be met:

You are not entitled to compensation if you were the party at fault in the accident
Documentation will be required to process your claim. Make sure you can provide photos, records of repairs made, and proof of the value of your vehicle by a trusted source.
In Arizona, the statute of limitations for filing a diminished value claim is 2 years.
Arizona does not have uninsured motorist coverage for diminished value claims.

Why adhering to Arizona’s car insurance requirements is important

Of course you don’t expect to be the one at-fault in an accident. However, if you do find yourself in this situation, liability coverage will step in to cover the damages you cause — up to your policy limits, that is. Because Arizona’s liability limits are quite low comparatively, it’s always a good idea to increase them. This can usually be done for a reasonably low added premium. If you are looking for increased protection and a low premium, a good place to start is by shopping for quotes.