Alaska Auto Insurance Requirements

Motorists must have liability auto insurance as per Alaska’s insurance law. This is a mandatory requirement unless registration is not required where you live. 

Even when registration isn’t required, motorists must buy car insurance in Alaska if they’ve been ticketed within the past five years and the violations have accrued six or more points. In this article, we discuss all Alaska auto insurance requirements.

Why is Auto Insurance a Big Deal in Alaska?

Most parts of Alaska, especially the last frontier, are inaccessible via roads. Alaskans prefer air or water travel to reach Juneau—the state’s capital. 

While some areas do not require motorists to be registered, you must produce proof of financial responsibility in areas where it’s needed. Proof of financial responsibility can be an updated insurance card or a copy of the same on your mobile devices. 

Failing to provide proof of financial responsibility is a traffic offense punishable with a fine or impounding of your vehicle.

The minimum limits for car insurance coverage include:

Bodily Injury

• $50,000 per person, or

• $100,000 per accident.

Property Damage 

• $25,000 per accident

Mandatory Auto Insurance Coverage in Alaska 

Your auto insurance policy must include coverage for bodily injury and property damage in areas where motorists must purchase auto insurance policies. By law, valid liability coverage should be $50,000 per person or $100,000 per accident for bodily injury. 

A liability auto insurance policy covers personal assets and legal fees if you’re the defendant, up to a specified amount. However, it doesn’t cover your medical bills.

Liability coverage covers property damage to a maximum of $25,000 per accident. However, the higher limit can sometimes vary by auto insurers. The property damage coverage pays for the plaintiff’s property damage and other people’s properties damaged in the crash, such as buildings, fences, walls, and more.

Optional Auto Insurance Coverage in Alaska

Motorists can purchase more insurance protection in addition to the mandatory auto insurance coverage discussed above. Optional auto insurance policies are more expensive because they provide more protection.

Car owners get the option to purchase optional auto insurance coverage when buying mandatory policies, so they can reject them. However, the benefits of purchasing optional coverages are worth more than their cost.

Uninsured and Underinsured Motorists in Alaska

Research shows that 13% of cars in Alaska are not insured. Sadly, you can’t file a claim with an insurance company if you’ve been involved in a car crash with an uninsured motorist. This is where the Uninsured Motorist coverage comes in. 

Uninsured and underinsured coverage pays for losses caused by uninsured and underinsured motorists. The plaintiff can recover minimum limits for bodily injury and property damage from using the basic insurance coverage and no more. 

The UIM coverage covers the difference between the other driver’s policy to a maximum of the purchased limit. UM/UIM coverage typically pays for bodily injuries, car damage, and property damage. 

Collision and Comprehensive Coverage 

Collision and comprehensive coverage take care of the cost of car repair, regardless of liability. Collision coverage specifically pays for car damages resulting from impact with another car, but comprehensive coverage pays for other non-direct damages, such as damage caused by a falling tree.  

Insurance deductibles are $500 for collision and $100 for comprehensive coverage. The lower the deductibles, the higher the premium. A deductible is an amount that must be paid by the insured before the insurer settles the claim.

Medical Payments Coverage 

Medical payment coverage is commonly known as MedPay. This optional auto insurance coverage pays for medical and funeral expenses, regardless of fault. MedPay covers family members and passengers besides the insured—the driver. The coverage can also be used to settle the costs associated with injuries, including:

• Hospital visits and stays,

• Doctor appointments;

• Surgeries and x-rays;

• Emergency services;

• Specialized home care, and more. 

Most Alaskans prefer the MedPay coverage option with a limit of $5,000.

Alternative Proof of Financial Responsibility 

Besides auto insurance cards, the alternative forms of proof of financial responsibility can include:

Surety Bonds 

Surety bonds can be used as proof of financial responsibility in Alaska. Surety bonds are contracts between drivers and licensed surety companies. Surety companies take the place of the driver if they can’t pay for damages in the event of an accident. 

Surety bonds must cover bodily injury and property damage up to the minimum limits set under the law. As a precondition, drivers must reimburse surety companies later. A certificate issued by your surety company acts as your proof of insurance once a bond is issued.

Self-Insurance

This option is suitable for people who own more than 25 cars. However, the DMV requires proof that you can at least pay $125,000 for property damage, bodily injury, or both, in the event of an accident. You’ll then get a certificate of self-insurance from the DMV for property damage, bodily injury, or both.

Alaska auto insurance requirements include mandatory and optional coverages. A lawyer can help you understand more on this topic.