A lien by definition is a list of demands placed on a piece of property or asset to satisfy a debt. There are two types of liens, voluntary and involuntary. The former is the more common usually set up by a financial institution and the latter is less frequent and usually mandated by the IRS for the payment of taxes. Voluntary liens can include extra demands on car insurance coverage and even require proof of regular maintenance performances. Involuntary liens demand that the tax amount owed be paid or at least arranged to be paid in full within a certain amount of time or the property will be seized.
In the more common case of voluntary liens, vehicle lienholders and car insurance companies work hand-in-hand with one another in defining your coverage requirements. Your state legislature requires certain minimum levels of protection, but if a lien is involved, the lienholder may stipulate higher levels of insurance as outlined in the agreement.