The state of Vermont is one of the few states that require its drivers to own uninsured/underinsured motorist coverage. Since not all states require drivers to own liability coverage, if you are involved in an accident and the responsible party is either uninsured or under insured, you can benefit from this coverage and see your expenses get covered while waiting for the responsible driver to pay the owed bills. Also this coverage helps pay in the situation of a hit and run event.

Liability insurance is also required, this coverage will pay for damage and injuries you cause to others (if held responsible) and requires the following minimum amounts:

• $25,000 to pay for one person's bodily injury expenses,
• $50,000 to pay for all involved in the accident and,
• $10,000 to pay for property damages.

Although not required, it is convenient for drivers to have collision and comprehensive coverage. The main objective of owning car insurance is to help you pay for any expenses in which owning and driving a car can make you have. Collision coverage, for example, will pay for the cost of your vehicle reparation, after it has been involved in an accident with another vehicle or any stationary object like street lights, walls, fences or trees. It will pay no matter the intensity of the collision (if you hit the garage door while backing up, or are part of a multiple collision on the highway) it will fix any physical damage your vehicle may suffer. In addition to collision coverage, comprehensive coverage will help when the damage was caused not by a car accident but by other situation out of your control, such as bad weather events in which your vehicle can be hit by flying pieces of debris, a falling tree, fire, etc. Even if you are involved in an accident with wildlife on the road.It is highly recommended for people living in states where weather tends to be extreme or also for those where wildlife may be encountered on the roads. Most common events covered by comprehensive are floods and tornados. None of these coverage types will pay for medical or legal expenses.

You can prove you have Financial Responsibility by owning the previously mentioned insurance coverage, having a surety bond purchased at the state treasurer (this needs to meet the insurance requirements of the state), by being self-insured (which requires you to fill out a number of paperwork and have your vehicle inspected) and having

Proof of insurance is provided by the insurance company at the moment when you acquire their services, this may come in the form of an insurance ID card, an official letter, etc. The insurance company also is compromised to file your proof of insurance to the Commissioner, either electronically or physically.

This proof may be requested when you are involved in an accident, when you get your vehicle inspected and when renewing or registering your vehicle.

If you fail to comply with this requirement you may be looking at having points taken from your license, payment of a fine, and more serious penalties.