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In Colorado, car insurance is mandatory for all drivers. Auto insurance regulations are enforced by the Colorado Department of Regulatory Agencies, Division of Insurance.
Until 2003, Colorado was a “no-fault" state, but changed the law in order to help reduce the cost of insurance premiums and help prevent claims abuses.
Colorado car insurance now operates as a tort system, meaning that fault must be established before an insurance company will pay a claim.
Required Car Insurance
Colorado drivers must have liability insurance, which covers only the other car and/or driver when an accident is your fault.
Colorado drivers must have liability coverage at the following minimums:
All other car insurance is optional.
Optional Car Insurance
Colorado auto insurance providers also offer a variety of optional coverage types:
NOTE: Finance and leasing vendors require you to have collision and comprehensive car insurance on any financed vehicle.
CO Car Insurance & Registration
The Colorado Division of Motor Vehicles (DMV) requires you to show proof of auto insurance to register your car or renew your registration.
The DMV will accept any of the following as proof of insurance:
NOTE: Failure to register your vehicle can lead to penalties or fines.
Violations of CO Car Insurance Laws
Colorado imposes various penalties for violations of insurance laws such as failure to provide proof of insurance during a stop or failure to purchase the minimum required insurance. Read below to learn about the specific penalties.
Failure to Hold Insurance
Failure to have minimum liability insurance results in the following penalties and fines:
Not only do you risk fines and penalties if you do not have minimum liability insurance, but you are also likely to have much higher rates when you re-apply for insurance after letting it lapse.
Always keep at least the required insurance minimums to ensure low-cost insurance rates long-term.
Failing to Carry Proof of Insurance
You must show proof of car insurance if you are stopped by a police officer or if you are involved in a traffic accident.
If you can't show proof of insurance during a stop, the officer can check the Colorado car insurance database to see if you have valid insurance. However, even if you have insurance, you may still be issued a ticket for failing to carry proof.
You may be legally required to file an SR-22 form (also known as SR22 insurance) from your insurance provider if your license:
SR-22 requirements vary by type of offense and number of offenses and may be required for a specific period of time.
An SR-22 is not insurance; rather, it is a certification filed by your insurance company stating that you will maintain the minimum liability insurance for a predetermined amount of time.
Failure to maintain your insurance policy with a current SR-22 will result in another suspension of your driver's license. Essentially, the insurance company notifies the DMV that you are no longer keeping your SR-22 current and the DMV penalizes you.
If you decide that you want a new insurance provider, you have to get your new agent to file an SR-22 BEFORE canceling your current policy and SR-22.
Alternative Insurance for High-Risk Drivers
If you've had certain traffic violations, you may be deemed a “high-risk driver" by insurance companies. If you are having a hard time finding an insurance carrier because of this status, you do have options.
Colorado participates in the Western Association of Automobile Insurance Plans (WAAIP), which helps high-risk drivers find car insurance.
Under the Colorado Motor Vehicle Insurance Plan, high-risk drivers are insured by a specific company found through WAAIP, but the risk is shared among all insurance companies operating in CO.
To seek coverage through WAAIP, ask an insurance agent to help you apply.
Policies obtained through the WAAIP tend to have much higher rates, so it's a good idea to shop around for car insurance quotes from multiple companies through the standard market before choosing this route.