3.1 Tennessee Auto Insurance Requirements
Key Takeaways
- Tennessee requires minimum liability coverage of 25/50/15 (bodily injury per person/per accident/property damage)
- Tennessee is a fault (tort) state - the at-fault driver's insurance pays for damages
- Uninsured/underinsured motorist (UM/UIM) coverage must be offered but can be rejected in writing
- Tennessee Financial Responsibility Law requires proof of insurance at all times while driving
- SR-22 filing required for 3 years after certain violations (DUI, driving without insurance)
Tennessee has specific auto insurance requirements that all producers must understand.
Tennessee Minimum Liability Requirements
Tennessee requires the following minimum liability coverage (often shown as 25/50/15):
Minimum Limits Table
| Coverage Type | Minimum Limit |
|---|---|
| Bodily Injury per Person | $25,000 |
| Bodily Injury per Accident | $50,000 |
| Property Damage per Accident | $15,000 |
Exam Tip: Tennessee's minimum limits are 25/50/15. Remember this format: BI per person / BI per accident / PD per accident.
Understanding the Limits
Example: With 25/50/15 coverage:
- Maximum payment for one person's injuries: $25,000
- Maximum payment for all injuries in one accident: $50,000
- Maximum payment for property damage: $15,000
Tennessee Fault System
Tennessee is a fault (tort) state:
How the Fault System Works
| Aspect | Description |
|---|---|
| Liability Determination | At-fault driver is responsible for damages |
| Recovery Options | Injured party can: (1) File with at-fault driver's insurer, (2) File with own insurer (if collision coverage), (3) Sue at-fault driver |
| Comparative Fault | Tennessee uses modified comparative fault - can recover if less than 50% at fault |
| Subrogation | Insurer can seek reimbursement from at-fault party |
Modified Comparative Fault
Tennessee follows the 49% Rule:
- If you are 49% or less at fault, you can recover damages (reduced by your percentage of fault)
- If you are 50% or more at fault, you cannot recover anything
- Example: $10,000 damages, 30% at fault = recover $7,000
Tennessee Financial Responsibility Law
Proof of Insurance Requirements
All Tennessee drivers must:
- Maintain minimum liability insurance at all times
- Carry proof of insurance in the vehicle
- Show proof when requested by law enforcement
- Provide proof at vehicle registration
Penalties for No Insurance
| Violation | Penalty |
|---|---|
| First Offense | $100-$300 fine, license suspension |
| Second Offense | $500-$1,000 fine, license suspension |
| Subsequent Offenses | Up to $2,500 fine, extended suspension |
| Registration Revocation | Vehicle registration suspended |
Uninsured/Underinsured Motorist Coverage
Tennessee has specific requirements for UM/UIM coverage:
UM/UIM Offer Requirement
| Requirement | Details |
|---|---|
| Offer | Insurers MUST offer UM/UIM coverage |
| Rejection | Insured may reject coverage in writing |
| Minimum Limits | Same as liability limits (25/50/15) |
| Stacking | Limited stacking allowed in Tennessee |
What UM/UIM Covers
Uninsured Motorist (UM):
- Accidents with drivers who have no insurance
- Hit-and-run accidents (phantom vehicle)
- Accidents with stolen vehicles
Underinsured Motorist (UIM):
- When at-fault driver's limits are insufficient
- Difference between at-fault limits and your damages
- Subject to your policy limits
Written Rejection
To reject UM/UIM coverage, the insured must:
- Sign a written rejection form
- Form must be retained by insurer
- Rejection applies to entire policy term
- New rejection required for new policies
Exam Tip: Tennessee requires insurers to offer UM/UIM coverage, but policyholders can reject it in writing. Without written rejection, UM/UIM is assumed to be part of the policy.
SR-22 Requirements
An SR-22 is a certificate of financial responsibility filed with the Tennessee Department of Safety.
When SR-22 is Required
| Violation | SR-22 Duration |
|---|---|
| DUI/DWI | 3 years |
| Driving without insurance | 3 years |
| Reckless driving | 3 years |
| At-fault uninsured accident | 3 years |
| Multiple traffic violations | 3 years |
SR-22 Requirements
- Filed by insurer with Tennessee Department of Safety
- Must maintain continuous coverage for full term
- Lapse in coverage triggers automatic notification to state
- License suspended if SR-22 lapses
- Higher premiums typical during SR-22 period
What are Tennessee's minimum auto liability insurance requirements?
Tennessee uses which type of auto insurance system?
Under Tennessee's modified comparative fault rule, a driver who is 55% at fault in an accident can recover:
How long must a Tennessee driver maintain an SR-22 after a DUI conviction?