The state requires drivers to meet its financial responsibility requirements through auto liability insurance or self-insurance in order to operate a vehicle. Accidents are costly, and the Pennsylvania Department of Transportation (PennDOT) needs to know you have the means of handling the possible expenses involved.

Ways to Establish Financial Responsibility

You can meet PennDOT’s financial responsibility requirements by either:

• Having an auto liability policy that meets the state’s standards.

• Being self-insured.

Pennsylvania Liability Insurance Requirements for Private Passenger Vehicles

If a vehicle has to be registered, you must at least have the following liability insurance protection in order to legally drive it:

• $15,000 of coverage for an injury or death to one person in a single accident.

• $30,000 of coverage for injuries or deaths to more than one person in a single accident.

• $5000 of property damage insurance.

Of course, these are just the minimum standards. Insurance experts suggest drivers carry much more protection than what’s required by PennDOT. As our liability insurance article discusses, causing an accident can be financially devastating, due to the direct expenses involved, as well as potential lawsuits. To safeguard yourself from these risks, it’s best to have as much liability insurance as you can afford.

Other supplemental insurance is also available to protect your investment in your vehicle; learn more about the options on our types of coverage page.

But, insurance premium costs can be an issue, particularly for younger drivers. So, take some time to investigate rates as well as coverages by doing online searches, or by calling the toll-free numbers provided by insurance carriers.

Self-Insurance

Although carrying insurance is the easiest and wisest choice for most, some drivers may want to meet the state's financial responsibility requirements through self-insurance.

To do so, you'll need to submit the following to PennDOT:

• Completed application for self-insurance.

• Completed master self-insurance and security agreement.

• Current balance sheet and income statement.

• Security deposit of $50,000 for one vehicle, and $10,000 for each additional vehicle (funded by cash, bonds, treasury bills, and other forms of collateral).

Proof of Insurance and Financial Responsibility

PennDOT doesn't receive word from your insurance carrier directly that you're a current customer, so you'll have to prove that you meet the state's minimum insurance requirements.

To do so, provide a copy of one of the following:

• Your insurance identification card or insurance policy declaration page.

• Insurance binder (if you go this route, you'll have to submit proof again after the binder's expiration date).

• Pennsylvania Assigned Risk Plan application (signed by your insurance agent).

• Letter from your insurer demonstrating your current coverage (signed by your insurance agent or an insurance company representative).

Penalties for Failure to Maintain Financial Responsibility

What happens if you have no proof of insurance? That depends on the action you take.

If you immediately turn in your plates to PennDOT, you won't face any penalties, aside from not being able to drive. The same is true if your insurance lapse was less than 31 days, and you can provide proof you didn't operate your vehicle during this time.

Otherwise, you may face a:

• $300 or more fine for driving without insurance.

• Three-month registration and driver's license suspension.

• $50 registration reinstatement fee.

• $50 driver's license reinstatement fee.

You'll receive a letter from PennDOT if your driving privileges are suspended. Just follow the guidelines in the letter to go about the task of reinstating your license and registration.

Keep in mind that no one can drive your vehicle during its registration suspension.