Car insurance became mandatory at different times across the United States, as there is no single federal law. The first state to enact a compulsory auto insurance law was Massachusetts in 1927. This pioneering legislation served as a model for other states, but widespread adoption took decades. New York followed in 1956, and North Carolina in 1957. The most significant wave of states making car insurance mandatory occurred from the 1960s through the 1980s. The last state to implement a mandatory insurance law was New Hampshire in 1997, and even today, it operates under a unique "financial responsibility" law that doesn't strictly require a standard insurance policy for all drivers.
The core idea behind these laws is financial responsibility, ensuring that drivers have the means to pay for damages or injuries they cause in an accident. Before these mandates, an at-fault driver could be personally liable for crippling costs, leaving victims with no recourse. Mandatory insurance creates a safety net. The specific requirements, known as liability coverage, vary by state but typically include Bodily Injury (BI) per person, BI per accident, and Property Damage (PD). The gradual adoption reflects each state's assessment of its own needs, balancing individual freedom with public safety.
The table below shows the adoption timeline for a selection of states.
| State | Year Mandatory Insurance Law was Enacted |
|---|
| Massachusetts | 1927 |
| New York | 1956 |
| North Carolina | 1957 |
| California | 1974 |
| Florida | 1979 |
| Texas | 1982 |
| Ohio | 1983 |
| Pennsylvania | 1990 |
| New Hampshire* | 1997 |
| *New Hampshire's law is a financial responsibility requirement, not a strict insurance mandate. | |
