Vermont Automobile Insurance Plan – VT AIP

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If you drive in the Green Mountain state and accumulate a record of traffic tickets or accidents, you may eventually find it difficult to obtain auto insurance. Vermont insurers may see you as a high risk for claims in the future, and even refuse to insure you. If you face this situation, you can turn to the Vermont Automobile Insurance Plan (VT AIP) as a last resort. You will likely find coverage through the Plan, as long as you meet the eligibility described below. In Vermont, all drivers must have liability auto insurance coverage in the amounts of 25/50/10 as well as Uninsured Motorist insurance of at least 50/100/10.

What is the Vermont Automobile Insurance Plan (VT AIP)?

Vermont’s Automobile Insurance Plan was created as Vermont’s residual auto insurance market in 1969. Its purpose is to maximize the number of insured Vermont drivers by giving eligible drivers who are unable to buy insurance in the voluntary market a last chance at adequate insurance coverage. Qualified drivers must seek help from licensed insurance agents in Vermont in order to enter the Plan’s assigned risk pool, also known as the high risk pool. It gets its name because most Vermont drivers who need the Plan's assignment are those whom insurers determined too high risk to insure normally.

The Plan is a voluntary agreement between the state and all auto insurers licensed in Vermont. The deal is that if an insurer wants to do ANY auto insurance business in Vermont, then that insurer must agree to cover a share of high risk drivers when they are assigned. The Plan assigns high risk drivers to Vermont auto insurers based on the total market share of auto insurance that they write. So if for example, GIECO covers 5% of all Vermont drivers, then GEICO will be assigned 5% of the high risk drivers in the state.

Once you are assigned an insurer through the Vermont AIP, that coverage will last for 3 years. We'd recommend you try to get back into the voluntary market, where you can find lower-priced coverage in the voluntary auto insurance in Vermont. The VT AIP is supposed to operate at neither profit or loss, therefore high risk drivers assigned by the Plan are usually charged higher premiums than their counterparts in the voluntary market, even if they are with the same insurer. At the end of 3 years, if you are still unable to find coverage on your own, then you are free to re-apply to the Vermont AIP.

Vermont AIP Eligibility

There are three requirements you must meet and follow in order to be accepted into the Vermont AIP’s assigned risk pool:

  • Certify on your Vermont AIP application that you have tried to find auto insurance through normal means within the last 60 days – and been unsuccessful.
  • Have both a valid driver’s license and a car that is registered (or about to be registered) in Vermont.
  • Finally, you need to complete the application to the Vermont AIP completely and truthfully.

You may be deemed ineligible for an auto insurance policy – even through the Vermont AIP – if you have an outstanding, unpaid auto insurance bill within the last 12 months, or if you have not brought your car for a requested safety inspection within the last 12 months. The good news is that if you pay the outstanding bill and/or present your vehicle for inspection, then your Vermont AIP application can proceed immediately. However, your application may also be denied if your prospective insurer discovers that important information in the application has been misrepresented or left out; they can refuse your application and suspend your Plan eligibility for 12 months.

Vermont AIP Coverage

Your assigned insurer must offer you the same coverage options as they would to other drivers they insure through the voluntary market. You may select the coverage limits for the mandatory coverage and add additional optional coverage when you get an auto insurance quote. However, you may pay more to get them, regardless of which insurer you are assigned to, as the Plan has developed it's own set of rating formula that all insurers use for assigned risk pool drivers.

The first table below shows the mandatory auto insurance coverages that you must have in Vermont. There are various mid-points of coverage in between the minimums and maximum levels of coverage shown. Talk with your assigned insurer about your financial situation to determine what levels of coverage are appropriate for your specific situation. Buying the least amount of coverage may cost you more in the long run if you are in an accident where the damages exceed the amounts of coverage you have. If you are at fault in the accident, you are legally responsible to pay the difference between what your insurance covers, and what the actual damages are.

Mandatory Coverage

Vermont Required Min. LimitsVermont AIP Maximum Limits

Bodily Injury (BI)

$25,000 per person / $50,000 per accident$250,000 per person / $500,000 per accident

Property Damage (PD)

$10,000 per accident$100,000 per accident

Uninsured Motorist Bodily Injury (UMBI)

$50,000 per person / $100,000 per accident$250,000 per person / $500,000 per accident

Uninsured Motorist Property Damage (UMPD)

$10,000 per accident$10,000 per accident

Your assigned Vermont auto insurer may also offer you the optional coverages shown in the table below. These will add to the cost of your premium, but are well worth considering. Medical Payments coverage can pay all sorts of medical or hospital bills that your health insurance or workman’s comp doesn’t cover. Physical Damage coverage in Vermont is a combination of Comprehensive and Collision coverage. Each comes with a deductible of your choice, with the options of: $100, $200, $300, $500, $750, or $1,000. Note that you must purchase BOTH Comprehensive AND Collision coverage together, or you may buy just Comprehensive alone. There is no option to buy Collision coverage on its own.

Optional CoverageVermont AIP Min. LimitsVermont AIP Maximum Limits

Medical Payments

$1,000 per person / accident$5,000 per person / accident


Actual cash value of your car, up to a maximum of $75,000No higher limit


Actual cash value of your car, up to a maximum of $75,000No higher limit

The Vermont AIP will cover cars, pickup trucks, vans, motorcycles, motorhomes, trailers and snowmobiles.

Vermont AIP Premiums and Payments

If you are assigned an insurer through the Vermont AIP, you are probably paying higher than the average auto insurance in Vermont. Auto insurers consider many factors when developing the premium for your policy. The more you know about those factors, the faster you may be able to leave the AIP.

By way of the AIP, your assigned Vermont insurer must offer you two payment plan options:

  • Pay up put 30% of the entire annual premium as deposit when you submit your application, and prepare to pay the full balance to your insurer within 30 days of receiving the policy.
  • Installment payment plan. This allows you to pay 25% of the annual premium with the application, and the remaining amount in 5 equal monthly installments. A $4 service fee is added to each installment payment.
  • Note that if you have a spotty payment history with regards to previous auto insurance bills, even if you are accepted into the Plan your assigned auto insurer can insist that you pay the entire annual premium up front with your application.

If you do improve your driving record and find lower auto insurance rates during coverage period, you can switch back into the voluntary market by notifying your assigned insurer of this fact. You should receive a prorated refund from them of the part of the premium that has not been used.

How to Apply for the Vermont Automobile Insurance Plan

In Vermont, any licensed auto insurance agent or broker should be able to walk you through the application process.

To learn more about the Vermont AIP, you can call Vermont’s Insurance Division at 1-800-964-1784 with questions. You can also visit the Vermont Auto Insurance Plan website.


Last Updated: January 2016

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