Key West isn't like anywhere else in Florida. You're literally at the end of the road—the southernmost point in the continental United States, where US-1 finally runs out of asphalt. And when it comes to auto insurance, that unique geography matters more than you might think. If there's an accident on the Overseas Highway, you're not taking a detour. You're waiting. Sometimes for hours. That reality shapes everything about driving and insuring your car in Monroe County.
But here's what's really important right now: Florida's entire auto insurance system is about to change. If you live in Key West or just bought a place here, you need to understand both what's required today and what's coming on July 1, 2026. Let's break it down.
What Florida Requires Right Now (Through June 2026)
Florida is currently a no-fault state, which means your own insurance pays your medical bills after an accident, regardless of who caused it. The state requires two specific coverages: $10,000 in Personal Injury Protection (PIP) and $10,000 in Property Damage Liability (PDL). That's it. You'll notice something missing from that list—bodily injury liability coverage isn't required at all for basic registration. This makes Florida unusual compared to most states.
PIP covers your medical expenses, lost wages, and essential services if you're injured in a crash. It kicks in immediately, no matter who's at fault. PDL covers damage your car does to someone else's property—their vehicle, their fence, their mailbox. The $10,000 limit sounds reasonable until you realize a minor fender-bender with a newer SUV can easily exceed that amount.
The Big Change Coming July 1, 2026
House Bill 1181 fundamentally rewrites Florida's auto insurance requirements. Starting July 1, 2026, PIP disappears entirely. You won't be able to buy it, and you won't be required to carry it. Instead, Florida shifts to a traditional at-fault liability system with new minimum requirements: $25,000 per person and $50,000 per accident for bodily injury liability, plus the same $10,000 for property damage. This is often written as 25/50/10.
What does this mean for you? If you cause an accident that injures someone, your bodily injury coverage pays their medical bills, lost income, and pain and suffering—up to your policy limits. If you only carry the minimum $25,000 per person and the other driver's injuries cost $75,000, you're personally responsible for that extra $50,000. This is a much bigger financial exposure than most people realize. Many insurance experts recommend carrying at least 100/300/100 limits if you can afford it.
Why Key West Is Different From the Rest of Florida
Monroe County records over 1,000 car accidents every year. That might not sound like much until you consider the population is only about 75,000 year-round residents. But the real story is the 5.6 million tourists who visit the Florida Keys annually. During peak season—roughly November through April—the roads transform. Traffic on US-1 can back up for miles. Rental cars with out-of-state plates pull sudden U-turns. Drivers towing boats misjudge distances. Tourists unfamiliar with the speed limit changes (which bounce between 45 and 55 mph) slam on their brakes.
Here's what makes this particularly challenging from an insurance perspective: there's often no escape route. When a serious accident closes US-1 between Marathon and Key West, that's it. You're stuck. Emergency vehicles can't easily bypass traffic. Response times lengthen. And if you're the one who caused the accident, the pile-up behind you could involve multiple vehicles, each with its own damage claim against your policy. This is why comprehensive and collision coverage aren't just nice-to-haves in Key West—they're financial protection against scenarios that happen here more often than almost anywhere else.
What Auto Insurance Actually Costs in Key West
Florida has consistently ranked among the most expensive states for car insurance, and the Keys are no exception. Statewide, full coverage averages about $243 per month or roughly $2,900 annually in 2025. Minimum coverage runs around $101 per month. These numbers put Florida near the bottom nationally—49th for minimum coverage affordability and 51st for full coverage (yes, worse than all 50 states and Washington, D.C.).
But there's genuinely good news. Insurance market reforms passed in recent years are finally delivering results. Multiple major carriers filed for rate decreases in 2025-2026: USAA dropped rates 7%, Florida Farm Bureau cut rates 8.7%, Progressive reduced rates 8%, State Farm decreased rates 10.1%, and AAA has reduced rates by a cumulative 15% through three separate cuts. If you haven't shopped your policy recently, now is an excellent time to compare quotes.
Coverage You Actually Need (Beyond the Minimums)
The state minimums—whether it's the current 10/10 PIP/PDL or the coming 25/50/10 bodily injury system—are exactly that: minimums. They're designed to get you legal, not to protect your assets. Here's what insurance professionals typically recommend for Key West residents:
Bodily injury liability at 100/300 or higher. Medical costs from serious accidents routinely exceed $25,000 per person. If you have any assets—a home, savings, retirement accounts—you need limits that actually protect them. Uninsured motorist coverage is critical. Despite insurance being mandatory, plenty of drivers skip it or let policies lapse. If someone without insurance hits you, this coverage steps in. Comprehensive and collision coverage protects your own vehicle. Comprehensive handles non-collision damage—hurricanes, flooding, theft, vandalism. Collision covers crashes regardless of fault. In an island environment where saltwater, storms, and heavy tourist traffic create constant risks, both make sense.
Consider rental reimbursement coverage. If your car is in the shop after an accident, you'll need transportation. In Key West, you can't just borrow a car from a friend across town or take public transit everywhere. Rental coverage typically adds only a few dollars per month but can save you hundreds if you need a rental for two weeks while repairs are completed.
Special Considerations for Key West Drivers
If you rent out your property as a vacation rental, tell your insurance company. Some guests will ask to borrow your car or golf cart. Your personal auto policy likely doesn't cover commercial use or regular lending to non-household members. You might need a specific endorsement or separate policy. Similarly, if you own a scooter, moped, or motorcycle for getting around the island, make sure it's properly insured. These vehicles are popular in Key West but face elevated risks from tourists who don't expect them.
Flood and storm coverage matter too. While your auto policy's comprehensive coverage handles some storm damage, it won't cover everything. If you park on the street during a hurricane evacuation and storm surge floods your engine, comprehensive should cover it. But always document where your vehicle is during named storms, keep proof of coverage accessible, and photograph your car before and after severe weather events.
How to Get the Best Rate
Shop around. Rates vary wildly between carriers, sometimes by hundreds of dollars annually for identical coverage. Get quotes from at least three companies. Ask about discounts—bundling home and auto, paying in full annually, maintaining continuous coverage, installing anti-theft devices, taking defensive driving courses. Many insurers offer 10-20% discounts you won't get unless you ask.
Review your policy annually, especially with the 2026 law changes approaching. If you're currently carrying only PIP and PDL, you'll need to add bodily injury coverage before July 1, 2026. Don't wait until the last minute—call your agent early in 2026 to adjust your policy and understand how your premium will change. The transition from no-fault to at-fault will affect everyone differently depending on driving record, coverage levels, and carrier.
Living in Key West means embracing a unique lifestyle, and that extends to how you insure your car. The combination of island geography, tourist traffic, and Florida's evolving insurance requirements creates a situation that demands more attention than simply buying the minimum and forgetting about it. Take the time to understand what you're buying, compare options, and make sure your coverage actually matches the risks you face driving at the end of US-1.
