When you drive across state lines, most auto insurance policies automatically adjust to the minimum insurance coverages required by the state where you are physically present. If your auto insurance policy coverage from a different state is already higher than a different state’s minimum coverage requirement, your coverage will remain the higher amount. If you are from Colorado and drive through Kansas, Missouri and Illinois, your auto insurance policy could change each time you cross a state line.

EXAMPLE: Kansas requires drivers to carry at least $4,500 in Personal Injury Protection (PIP) benefits. Missouri does not require drivers to carry any PIP coverage at all. If a Missouri driver crosses state lines and has an accident in Kansas, the Missouri auto insurance policy will automatically adjust to the minimum PIP coverage amount to match the Kansas minimum of $4,500 in PIP coverage.

What legal authority forces insurance companies to comply with state minimums?

Most auto insurance policies have contractual provisions in the policy language that indicate that “the policy will automatically adjust to state minimums.” In many states, there are statutory requirements that require insurance companies to comply with state minimums.

In Kansas, all insurance companies who sell policies within the state are required by statute to sell policies that conform with Kansas insurance laws. This is a condition of selling insurance within the state of Kansas. K.S.A. 40-3106(b), “Every insurance company authorized to transact the business of motor vehicle liability insurance in this state shall file with the commissioner as a condition of its continued transaction of such business within this state a form approved by the commissioner declaring that its motor vehicle liability policies, wherever issued, shall be deemed to provide the insurance required by K.S.A. 40-3107, and amendments thereto, when the vehicle is operated in this state.”

Many states also have case law which require insurance companies to adjust their policies to the minimum state requirements. In Morris v. Am. Std. Ins. Co., the court reasoned that the Kansas Automobile Injury Reparations Act (KAIRA) required that residents and nonresidents be treated in the same manner.