Insurance
Car Insurance in Tennessee
Published September 24, 2026 · Last updated October 1, 2026
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Does Tennessee require car insurance?
Yes. Tennessee's Financial Responsibility Law requires liability coverage of at least 25/50/25:
- $25,000 for injury or death of one person
- $50,000 for injury or death of everyone in one crash
- $25,000 for property damage
A few people use a $65,000 bond or a $65,000 cash deposit with the Department of Revenue instead. For almost everyone, it's an insurance policy.
Commercial plates need a commercial policy. If your vehicle has a commercial license plate, a personal auto policy isn't enough.
How Tennessee checks for insurance
Since 2017, Tennessee has used an Electronic Insurance Verification System under the James Lee Atwood Jr. Law. It checks with insurers to confirm that registered vehicles are covered.
If the state can't verify your coverage, you'll get a letter. Here's what happens if you ignore it:
| Step | What happens |
|---|---|
| First notice | Respond within 30 days or you're fined $25 |
| Final notice | Respond within 30 days or you're fined $100 and your registration is suspended |
With a suspended registration, you can't legally drive the car on Tennessee roads. If you get a notice and you do have insurance, respond right away with your policy details. It may just be a reporting mix-up.
Uninsured motorist coverage: what you get by default
In Tennessee, your uninsured motorist (UM) coverage automatically matches your bodily injury liability limits. If you carry 100/300, your UM is 100/300 too.
You can change that, but only in writing:
- Reject UM completely, or
- Choose lower UM limits, but no lower than the state minimums.
With more than 1 in 5 drivers uninsured, rejecting UM is a big gamble in Tennessee. Ask what it costs before you give it up.
Fault matters: the 49% rule
Tennessee uses modified comparative fault. You can collect from the other driver only if your share of the blame is less than theirs, and your award is reduced by your share.
- You're 20% at fault: you can collect 80% of your damages.
- You're 50% at fault: you can't collect from the other driver.
When fault is split evenly or leans your way, your own coverage has to carry you. Collision fixes your car either way, and medical payments coverage can help with your medical bills.
How much is car insurance in Tennessee?
It depends on your city, record, car, and coverage. In 2021, Tennessee households spent about 1.40% of their income on car insurance, a bit below the U.S. average of 1.50%.
Two local factors push some prices up:
- Uninsured drivers. More uninsured drivers can mean higher uninsured motorist costs for everyone else.
- Theft in Memphis. Tennessee thefts fell 31% in 2025, but the Memphis area still had one of the highest vehicle theft rates in the country. See Memphis car insurance.
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Live in Memphis? See Memphis car insurance. Need to show proof of insurance after a suspension? See SR-22 insurance.
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More Tennessee guides: Memphis car insurance · Tennessee homeowners insurance
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Sources
- Tennessee Department of Revenue, Financial Responsibility Law
- Tennessee Department of Revenue, DIFD-1: Insurance verification overview
- Tennessee Department of Revenue, DIDF-8: Notification letters and penalties
- Tenn. Code Ann. § 56-7-1201 (uninsured motorist coverage)
- McIntyre v. Balentine, 833 S.W.2d 52 (Tenn. 1992)
- National Insurance Crime Bureau, U.S. vehicle thefts experience historic decline (Mar. 18, 2026)
- Insurance Information Institute, Uninsured motorists (IRC 2023 data)
- Insurance Information Institute, Auto insurance affordability (IRC)