Question: What is the no pay, no play car insurance law, and what states have this type of law in place?

Answer: Most states have harsh penalties if caught driving without insurance, especially if you’re in an accident. States with “no pay, no play” laws take it further by prohibiting uninsured motorists from being compensated for certain items, even if they weren’t at fault for the accident.

No pay, no play states want to draw attention to the fact that they are limiting uninsured motorists from receiving certain compensations because they wouldn’t be able to provide those same benefits to others.   

Here are a handful of states with some sort of no pay, no play law in place

Most states with no pay, no play limitations on car insurance claims (and lawsuits) are only on non-economic damages. This includes pain and suffering, mental anguish and loss of companionship. Economic damages, the uninsured motorist’s actual medical bills and property damage, are typically still recoverable.

States intend for no pay, no play laws to reinforce that all drivers need to comply with state financial responsibility laws. The Insurance Information Institute in 2021, citing an earlier report by the Insurance Research Council, said states adopting such laws could see a 1.6% drop in their uninsured motorist rate.

There are small differences in each state though. Here are two examples:

  • In Kansas, if you’ve been uninsured less than 45 days and had car insurance for the full year before the lapse, then you can still seek compensation for economic and non-economic damages.  
  • New Jersey’s law bars people without medical-expense insurance who are injured and those who injure themselves or others while operating an uninsured vehicle from recovering economic or non-economic losses. 

The list of no pay, no play states was reduced by one when in late 2014 the Oklahoma Supreme Court found its state’s no pay, no play law unconstitutional. It requires special treatment of uninsured accident victims — not allowing them to collect on pain and suffering — and the court ruled that a special class created in this manner violates the Oklahoma Constitution.

The best way to not be affected by no pay, no play laws is to stay insured. If your current auto insurance rates are too high, compare car insurance and look for ways to save before dropping coverage.

— Penny Gusner contributed to this story.

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Executive Editor

Laura is an award-winning editor with experience in content and communications covering auto insurance and personal finance. She has written for several media outlets, including the USA Today Network. She most recently worked in the public sector for the Nevada Department of Transportation.