08/16/2016 02:34 pm ET Updated Aug 17, 2017

The Problem of Car Insurance for Undocumented Immigrants

It is widely known that undocumented immigrants make up a large part of the American work force. What may not be as widely known is that many are forced to drive without car insurance - something that is both illegal and costly. Getting into an accident as an uninsured motorist can easily end up costing tens or hundreds of thousands of dollars. Faced with the prospect of deportation, the situation is even more precarious for undocumented immigrants.

Unfortunately, to make a living, many immigrants take on the risk of driving uninsured anyway.

What's the major problem? Paperwork. For undocumented immigrants, the largest hurdle towards valid car insurance is a valid driver's license. Anyone seeking to get car insurance in the country needs one. As of today, the majority of states make this nearly impossible.

There are some places taking steps towards solving this impasse. Twelve states plus Washington D.C. allow undocumented immigrants to receive a driver's licenses. California, Nevada and Illinois are some of the largest states to issue licenses to this population. As it happens, a large percentage of undocumented immigrants live in these three states. The remaining states that allow the practice are Colorado, Connecticut, Delaware, Hawaii, Maryland, New Mexico, Utah, Vermont and Washington.

For those who do not live in one of the above-mentioned regions, the next best step is to see whether they can qualify for Deferred Action of Childhood Arrivals (DACA) program. It allows certain undocumented immigrants to apply for a renewable two-year work permit without deportation. However, they need to meet certain criteria. To qualify, the immigrant must have arrived to the U.S. before their 16th birthday, were younger than 31 as of June 15th 2012, have lived in the U.S. consistently, have completed at least a GED and not have a criminal record. Once your status is changed, you can apply for a driver's license through the traditional channels. DACA is available in all 50 states.

What's The Risk of Driving Uninsured?

Undocumented immigrants with a valid license should always purchase car insurance. Trying to skip this cost can result in severe consequences -- more so for this group than anyone else. Depending on the state you live in, those caught driving without insurance can be penalized upward of $1,000. Plus, some states consider this a criminal offense. As a result, undocumented immigrants caught driving without insurance could face deportation.

How You Should Shop for Auto Insurance

Car insurance can be expensive, especially if you are under 30. Luckily, you only need enough to satisfy the law. Every state has a minimum amount of insurance drivers needs to carry. For example car insurance in Massachusetts requires you carry $20,000/$40,000 limits for bodily injury liability, as well as $5,000 for property damage liability. Most states will not go below $10,000 for bodily injury, nor will they exceed $50,000. A policy consisting of just liability coverage is by far the cheapest option, usually costing less than $50 per month with a clean driving record. Still, that does not mean you should settle for any insurer. You should shop around for the best car insurance in your area, getting no less than 3 quotes from different companies. Car insurance companies differ on their pricing by possibly hundreds of dollars, so it is important to be sure you are getting the cheapest.