For the last few months, with things like foreign tariffs looming over us, the future costs of various goods and services has been a lingering concern for many. Future car prices is a massive concern, with foreign cars being affected by tariffs as well as parts for American made cars. With this worry hanging over Americans’ heads, Minnesota officials have begun discussions for a low income car insurance program to help ease some financial worries for low income residents. This idea comes after reports showed that insurance premiums increased in Minnesota by 58% in 2024. According to the nationwide report released by Insurify, this was the largest increase of any state.

The proposed program would help make coverage affordable for low income drivers.

The program would be called the Minnesota Lifeline Insurance Program. With this program, the coverage would be low cost and liability only. In order to qualify for the program, legislatures have created an income benchmark that would determine if one has a low enough income. The bill proposing the program is backed by State Representative Athena Hollins. She has stated that she supports the program as it would help to guarantee safety on the road while creating a more even system of auto safety.

This program is not the first to be proposed in U.S. history.

Similar programs have been brought up in state legislatures such as in California, Hawaii, and New Jersey. All three states passed such programs, offering income-restricted insurance plans. The plans have helped to lower the number of uninsured drivers operating within these states.

The bill lays out how the program would work.

The bill, HF 2215, says that the policies will come from state-licensed insurers. There would be a 10-cent surcharge on all auto policies that are written in the state. This surcharge would provide the funding needed for marketing and outreach of the program. There is a proposed $20,000 annual budget allocation meant for hiring an independent actuary. Furthermore, the proposal includes a flexible spending limit for 2026 while the program were to be established and advertised.

The program would provide the bare bones of coverage.

Physical damage coverage, such as collision or comprehensive, would not be provided. This would require state minimum requirements to slightly adjust in order to allow policies of this nature. Additionally, personally injury protection coverage would be reduced by the bill, from $40,000 to $5,000. These adjustments would be made in order to get more people some form of auto insurance rather than none at all while being able to realistically provide coverage for a low cost.

One large hiccup lies in the proposed program.

If someone does not own their car, they may not be able to have insurance through the program, even if they qualify based on income. The reason for this is that many lenders require physical damage coverage for those who are renting or financing their vehicle.

For now, the bill and its proposed program continue to be discussed in Minnesota legislature.