Significance

• If you are merely stopped while driving in Iowa and don't have insurance, there is no penalty. However, if you are at fault, or are the owner of a vehicle whose driver was at fault, in an accident causing an injury, death or more than $1,000 in damage, you must prove financial responsibility.
  
  

Types

• Options for showing responsibility after an accident, other than an auto insurance policy, include depositing enough money with the state to cover the accident or providing evidence that you have reached a financial settlement with all parties, including a plan to pay all claims. Alternatively, you can get releases from all the other parties saying you do not have to pay, or obtain a court judgment absolving you of responsibility.
  
  

Penalty

• Inability to show proof of financial responsibility results in immediate suspension of your license and auto-registration privileges until you can show such proof. Further, you can only get your driving privileges reinstated if you demonstrate proof of financial responsibility for future accidents.