Find out what types and amounts of car insurance coverage are required in the Beaver State
In Oregon, as is the case in most states, drivers are required to maintain certain types and amounts of auto insurance coverage.
In this article, we’ll take a look at the details of Oregon’s auto insurance requirements. We’ll also take a look at how you can recover damages after a car accident, and what you can do if the driver who caused your accident is uninsured.
Is Oregon a fault-based insurance state?
Generally speaking, there are 2 types of auto insurance systems that states follow:
- Fault-based insurance systems (sometimes called “tort systems”). In states that follow a fault-based insurance system, car accident victims receive compensation from the at-fault party or their insurance company. Divers typically purchase liability insurance to protect themselves from having to pay damages that result from accidents they cause.
- No-fault insurance systems. In states that follow a no-fault insurance system, all drivers in an accident—regardless of who’s at fault—turn to their own insurance policies to cover the damages. In most no-fault insurance systems, it’s not possible (or usually necessary) to sue the other party for their damages.
Oregon follows a fault-based insurance system. This means that, if you’re involved in a motor vehicle accident on Oregon’s roads, you have 3 options to recover damages:
- File an insurance claim with the at-fault driver’s insurance company,
- File a personal injury lawsuit against the at-fault driver, or
- File an insurance claim with your own insurance company (in which case your insurance company will seek reimbursement from the at-fault driver’s insurance company).
On the other hand, if you’re responsible for an accident, you can expect that a claim will be made with your insurance company or you will be sued for damages (in which case your insurance company will defend you so long as the accident may be covered by your policy).
Oregon car insurance minimum requirements
Pursuant to Oregon Revised Statute Section 806.010, it’s illegal to drive in Oregon without at least the following minimum coverage:
- Bodily injury and property damage liability coverage
- $25,000 per person
- $50,000 per crash for bodily injury to others
- $25,000 per crash for damage to another's property
- Personal injury protection (PIP)
- $15,000 per person
- Uninsured motorist (UM)
- $25,000 per person
- $50,000 per crash for bodily injury
Oregon’s insurance requirements apply to motor vehicles and motorcycles. Oregon’s insurance requirements do NOT apply to the following vehicles:
- Farm trailers
- Farm tractors
- Certain vehicles that are maintained as collector’s items and not used for the transportation of people or property
- Snowmobiles
- Motor-assisted scooters
- Electric personal assistive mobility devices
Penalties for driving uninsured in Oregon
Oregon law requires that you carry proof of insurance coverage while you’re driving. You must show your proof of insurance to the other driver if you’re involved in an accident and to the police if you’re pulled over.
If you don’t have the required auto insurance, the following penalties apply:
- A fine between $130 and $1,000
- A 1-year license suspension
In addition, if you’re involved in an accident and you don’t have car insurance, you’ll be personally liable for any damages that you cause.
Optional Oregon car insurance coverage
The minimum liability insurance required may not be enough to cover a serious or catastrophic car accident, leaving you personally liable for the amount of damages that exceed your policy limits. For this reason, many people choose to purchase additional liability insurance. The downside to purchasing additional liability insurance is that it will typically result in a more expensive premium payment.
Along with additional liability insurance, drivers in Oregon can purchase the following optional coverage:
- Comprehensive coverage provides coverage for losses other than those caused by a collision (vandalism, falling objects, fire, etc.)
- Collision coverage provides coverage for damage to your vehicle caused by an accident with another vehicle or an object (such as a fence)
- Uninsured motorist (UM) property damage provides coverage for property damage sustained by you or the passengers in your vehicle as a result of an accident involving an uninsured driver.
How does insurance work when a friend or family member borrows your vehicle?
Liability insurance generally follows the vehicle in Oregon, not the person. To put it another way, if you let someone borrow your car and they cause an accident, your liability insurance should pay for the damages to the other driver and their passengers.
If the damage exceeds the vehicle owner’s policy limits, the insurance of the person who borrowed your vehicle may act as secondary coverage (i.e., cover the difference between your policy limits and the amount of damages sustained).
Unlike liability coverage, PIP coverage follows the person in Oregon.
How to handle an accident in another state
If you’re gearing up for a big road trip, you might be wondering whether your car insurance provides coverage if you’re involved in an accident in another state.
Most auto insurance policies cover all 50 states (as well as other U.S. Territories). Some policies will even cover Canadian provinces.
Although different states have different insurance requirements, your coverage limits will automatically adjust to meet whatever is required in the state where the crash occurred.
What’s more, if you’re involved in an accident in a no-fault state, your insurance policy will tack on the minimum PIP coverage required in the no-fault state (allowing you to file a claim and recover damages through your own insurance company).
Oregon unfair claim settlement practices
An insurance policy is a contract between the insured (you) and the insurance company. In exchange for a monthly premium, the insurance company agrees to provide the coverage set forth in the policy.
Oregon Revised Statute Section 746.230 requires insurance companies to follow certain standards in order to hold up their end of the policy.
The law makes it illegal for your insurance company to unreasonably deny your insurance claim or engage in any unfair practices, which include things like:
- Misrepresenting pertinent facts or insurance policy provisions
- Failing to acknowledge and act reasonably promptly after a claim is filed
- Failing to promptly investigate a claim
- Refusing a claim without conducting a reasonable investigation
- Failing to affirm or deny a claim within a reasonable time
- Forcing the insured to initiate or submit to litigation by offering substantially less than the amount ultimately recovered in litigation
If your insurance company behaves unfairly, you have the right to sue them in court for “bad faith.”
If you have questions about Oregon’s insurance laws, or if you want to file a personal injury lawsuit, we invite you to schedule a consultation with an Oregon personal injury attorney near you using our free online directory.
See our guide Choosing a personal injury attorney.