Guide to Car Insurance in North Carolina

North Carolina requires drivers to carry the minimum coverage to legally operate a vehicle.¹ Unlike in most other states, its minimum coverage requirements include uninsured/underinsured coverage (UI/UIM) on top of standard liability coverage. Keep in mind the minimum coverage may still not be enough to cover you in a big accident.

The state raised its requirements in 2025. The current minimum coverage requirements are:

• Bodily injury limit: $50,000 per person/$100,000 per accident
• Property damage limit: $50,000
• Uninsured/underinsured coverage (bodily injury): $50,000 per person
• Uninsured/underinsured coverage (property damage): $100,000 per accident

If it’s in your budget, consider getting a policy with these higher limits instead:

• Bodily injury limit: $100,000 per person/$300,000 per accident
• Property damage limit: $100,000
• Uninsured/underinsured coverage (bodily injury): $100,000 per person
• Uninsured/underinsured coverage (property damage): $300,000 per accident

The cost of auto insurance in North Carolina averages $1,830 annually or $152 monthly for full coverage—that’s 22 percent lower than the national average of $2,356 annually. If you opt for the minimum coverage instead, you’ll pay $669 annually or $56 monthly on average.

Factors like credit score, driving history, and location will affect rates you are quoted. For instance, drivers in Winston-Salem can expect to pay $1,594 annually, while those in Charlotte can expect to pay $1,962 annually. Densely populated cities often have higher premiums due to risk factors like higher accident rates.

At-Fault State

Like most states, North Carolina is an at-fault state, which means any driver who is at fault in an accident pays for both property damage and bodily injury.

North Carolina is one of the few states to enforce a pure contributory negligence rule. This means you’re ineligible for compensation for an accident if your negligence contributed to it in any way—even if you’re only one percent at fault or if you were injured.² Insurance adjusters will investigate the accident scene to determine who was at fault or negligent.

Driving Without Insurance

Almost 12 percent of North Carolina drivers are uninsured, up from 10 percent the previous year.³

Driving without insurance is a Class 3 misdemeanor with escalating penalties that may include:

• Fine of $50-$150 depending on the offense
• Restoration fee of $50
• License plate/registration suspension
• Probation or jail time⁴

You must always have proof of insurance while driving. If not, you’ll be charged with a Class 1 misdemeanor—even if you’re insured—again with possible fines up to $150, jail time or probation, and license plate/registration suspension.

DWI Laws

A DWI (driving while intoxicated) is a serious offense in North Carolina and is defined as operating a vehicle with a blood alcohol concentration (BAC) of 0.08 or more.⁵

• Permanent record: A DWI will stay on your record indefinitely.
• Convictions for BAC under 0.08: You can get a DWI even with a BAC under 0.08 if your physical or mental faculties were clearly substance-impaired. For under-21 drivers, any trace of alcohol or drugs is illegal.
• Potential penalties: Fines up to $2,000, jail time of up to one year, license suspension, vehicle impoundment, and mandatory use of an ignition interlock device.

Seat Belt Laws

In North Carolina, you must wear a safety belt when driving or riding in a vehicle.⁶

• Front seat passengers: A police officer can pull you over and issue a citation if you or a front-seat passenger were not wearing a seat belt.
• Back-seat passengers: A ticket can only be issued for an unbuckled back-seat passenger over 16 years old if there is another citable traffic offense.
• Passengers under 16: Kids and teens must be buckled in or riding a child safety seat at all times, regardless of where they’re sitting. The driver is responsible for all passengers under 16, including for any tickets issued.

Distracted Driving Laws

In North Carolina, it is illegal to manually text and read messages while driving (police and emergency personnel excepted). Use of voice-operated technology to perform these tasks is allowed for drivers over 18, however. Drivers under 18 can’t talk on the phone at all while driving, even wirelessly, unless they’re talking with their parents or are in an emergency.

Teen Driver Laws

North Carolina has a graduated licensing system for teen drivers between 15-17 years old, designed to encourage safe and responsible driving.⁷

• Level 1 (Learner’s permit): Teens can apply once they turn 15 and after finishing a state-approved driver’s ed course. They must be supervised by an adult over 21, and for the first six months can only drive between 5 a.m. to 9 p.m.
• Level 2 (Limited provisional license): Teens can apply once they turn 16, have had their Level 1 permit for nine months, and completed 60 hours of supervised driving (10 at night). They can drive unsupervised between 5 a.m. to 9 p.m., with restrictions on transport of under-21 passengers.
• Level 3 (Full provisional license): Teens can apply once they’ve had their Level 2 license for six months and completed 12 more hours of driving (six at night), with no violations in the past six months. They can only drive 5 a.m. to 9 p.m. until they turn 18
• Full Class C license: A Level 3 license automatically turns into a full Class C license with no restrictions once the teen reaches age 18.

Cancellation and Non-Renewal Notification Laws

Insurers may choose to cancel or not renew a policy for a number of reasons:

• You haven’t paid your premium consistently.
• You have committed fraud or misrepresentation on your application.
• Your driver’s license has been revoked or suspended.
• Your insurance provider no longer provides that specific type of insurance.
• You have been cited with a DUI.

They must let you know ahead of time if they decide to cancel or not renew your policy, per these timeframes:

• Cancellations for fraud, misrepresentation, or license suspension/revocation: 60 days
• Cancellations for nonpayment: 15 days
• Non-renewals: 60 days

Other Important Laws in North Carolina

• Serious Injury and Monetary Thresholds: There aren’t injury or monetary minimum thresholds—but there is a limit to how much a victim can sue a driver for an accident-related injury. The punitive damages can’t exceed three times the actual damages or $250,000.
• Accident Reporting: If you’re in an accident with losses exceeding $1,000 in injury, property damage, or death, you must report to the police immediately. If you don’t, you may face a $100 fine.
• Statute of Limitations: You have three years from the accident date to file a claim for property damage and personal injury. If you miss that timeframe, you can’t receive coverage for those damages/injuries.⁸
• Total Loss Definition: A vehicle is a total loss when its repair cost exceeds its actual market value (AMV). In North Carolina, the damages need to equal just 75 percent of AMV for it to be a total loss. If your car is worth $10,000, it needs to incur only $7,500 in damages for your maximum total loss coverage to kick in.

Find cheap car insurance rates in North Carolina by:

• Comparing quotes: Get at least three quotes from different providers with the same coverage. Some companies have better rates depending on your driving profile.
• Increasing deductibles: Set higher deductibles for collision and comprehensive coverage to decrease your premiums.
• Bundling policies: Combine different insurance types with the same provider, like home and auto insurance, to save up to 20 percent on premiums.
• Asking about discounts: Most major insurance providers will offer discounts. Simply ask your insurance agent if you qualify for any of them.

Some states require insurers to file an SR-22 form for a driver with a criminal background or history of serious traffic violations. However, North Carolina doesn’t have SR-22 requirements specifically. The closest equivalent is its DL-123 form, which applies not just to drivers with a DWI on their record, but also new North Carolina residents who are seeking a license.

If you were required to get an SR-22 in another state prior to moving to North Carolina, you may need to obtain a DL-123 from your insurance company.

North Carolina car insurance requirements are more robust than many states, including mandatory uninsured/underinsured motorist coverage. However, drivers still benefit from below-average premiums at about $1,830 annually for full coverage. While minimum coverage meets legal requirements, higher limits offer better financial protection.

As an at-fault state with strict contributory negligence rules, even minimal fault can prevent you from recovering damages after an accident. The state also enforces firm laws around insurance compliance, DWIs, and distracted driving, with meaningful penalties for violations.

Comparing quotes, bundling policies, and adjusting deductibles can help drivers find more affordable coverage.