Indiana Automobile Insurance Plan (IN AIP)

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The “Hoosier state” offers auto insurance coverage to high risk drivers through the Indiana Automobile Insurance Plan (IN AIP). The plan was created to provide backup automobile insurance coverage to people who couldn't get insured through the voluntary market in Indiana, but met certain conditions.

If you are considered a high-risk driver due to accidents, DUIs or multiple traffic violations, standard auto insurers may refuse to cover you in what's known as the voluntary market. The IN AIP is the “last resort” in this situation, because you must have insurance in order to drive legally.

What is the Indiana Automobile Insurance Plan (IN AIP)?

The Indiana Automobile Insurance Plan was created in 1948. The program is an agreement among all the licenced auto insurance companies in Indiana to accept a share of high risk drivers that matches their share of the total auto insurance market in the state. The goal is to make sure any Indiana driver who meets the eligibility has access to an auto insurance policy, especially those who have been unable to obtain insurance through the voluntary insurance market. The plan works as the residual market for auto insurance, and allows the insurance companies to pool their losses and maintain the broadest possible coverage for drivers.

All auto insurance agents in Indiana can help you apply for insurance through the AIP. Note that you will be assigned an insurance company based on market share, not on your individual preference.

IN AIP Eligibility

In order to be able to apply to the AIP, you must certify that you’ve been turned down by three insurance companies in the state in the prior 60 days. You may have to name the companies! You can apply to the AIP for coverage as long as you have a valid driver’s license and a car registered (or about to be registered within 15 days) in the state of Indiana.

You may be ineligible for coverage - even through the AIP - if you have an unpaid premium from another auto insurance company, or if you misrepresent any information on your IN AIP application. If you pay the outstanding premium, you can re-apply to IN AIP at any time. If you are caught misrepresenting something on your application, you may have to wait 12 months to reapply to the AIP.

IN AIP Coverage

In Indiana, the law requires that you must have liability insurance that covers at least $25,000/$50,000 of the bodily injury and at least $25,000 of the property damage in any one given accident you cause. Like any policy in the voluntary market, higher amounts of coverage are available for both of these.

Once you receive a policy through the IN AIP, the coverage will last for three years. If you use this time to clean up your driving record, you may become eligible for better auto insurance rates in the Indiana voluntary market. If, however, you still need high risk coverage, you may reapply to the IN AIP at the end of the three years, and be considered a “new applicant”, qualifying you for another three years of coverage.


Bodily Injury (BI)$25,000 per person/$50,000 per accident$25,000 per person/$50,000 per accident; higher if requested
Property Damage (PD)$25,000 per accident$25,000 per accident; higher if requested

Note that you can request higher levels of these mandatory coverages if you wish, for a higher premium. Be aware that Indiana ranks 14th in the nation for the number of uninsured drivers, so you may want more than the minimums.

There are also optional coverages available through the IN AIP. Uninsured Motorist and Underinsured Motorist coverages will be offered to you if you are buying a policy for the first time. These coverages are highly recommended, considering that almost one in five Indiana drivers is driving uninsured. Think about your financial situation to determine how much coverage you need to protect your assets. Since your insurer assignment is random and the available optional coverage varies by company, your insurance agent can explain what optional coverages are available, and at what limits.



Uninsured Motorist BI (UMBI)

$25,000/$50,000max cannot exceed you regular BI coverage

Uninsured Motorist PD (UMPD)


Underinsured Motorist BI (UIMBI)

$50,000/$50,000varies by insurer

Medical Payments



$100 deductibleActual cash value of vehicle, up to a max of $25,000


$100 deductibleActual cash value of vehicle, up to a max of $25,000

Indiana allows auto insurers to write AIP policies for up to $5 million in coverage (that’s all coverages combined). This is not the norm, but you want enough coverage in case you cause a serious accident, or have a number of assets to protect.

IN AIP Premiums and Payments

Premiums for high risk drivers in the IN AIP are generally (but not always) higher than in the voluntary market.You can better manage your auto insurance costs if you understand the factors that affect your premiums. The IN AIP considers a slew of criteria when developing the premium for your policy. The more you know, the more you can take corrective action.

There are 2 options for paying your IN AIP premium. The first is to pay 40% of the total premium along with your application, and the rest within 30 days. The other is an installment plan. Again, you must put 40% of the annual premium down, and you will be billed for 30% of the premium after 90 days, and the remaining 30% in six months. There is a small service charge if you use the installment plan.

If you do find auto insurance coverage at a better price, you can cancel your policy through the AIP at any time. Be aware that if you cancel in the middle of the policy term, you won’t get a prorated refund of your premium. The insurance companies will keep what they call the “short rate earned premium” – which is slightly more than the prorated amount – and they will refund the rest to you.

How to Get Insurance through Indiana’s Automobile Insurance Plan

Every licensed auto insurer in Indiana knows about the IN AIP and they can walk you through your options for obtaining insurance.

Know that there are always non-standard insurance companies that specialize in offering auto insurance to high-risk drivers and do so voluntarily in Indiana. This is another option to consider before you turn to the state residual plan. The Indiana auto insurance market has become more high-risk friendly, while the IN AIP has shrunk in size. It is worth your while to contact several companies to understand the range of offerings that are available.

For more information about the IN AIP, call Indiana’s Department of Insurance at 1-800-622-4461.

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