Securing a cheap auto insurance premium is a top priority for many California drivers. So, to help you find the best rates available, follow this advice for finding the cheapest rates in California.
Auto Insurance Requirements in California
When you operate a private vehicle in the state of California, you must meet set liability insurance requirements. When you’re legally liable for the injuries or property damage caused to someone else, liability insurance can compensate that individual. Conversely, if you’re the victim of a collision, you can make a claim against the other driver.
As a California driver, you must meet the minimum liability requirement, including:
- $5,000 for property damage per person
- $15,000 for injury or death per person
- $30,000 for injury or death of multiple people
When Do I Have to Provide Proof of Insurance?
You are required to show proof of coverage when:
- Asked for it by law enforcement
- You renew your vehicle registration
- You get into an accident
In the state of California, you’re authorized to provide proof of coverage via mobile phone or paper copy you keep in your vehicle.
Penalties for Driving Without Auto Insurance in California
There are consequences for not meeting California’s auto insurance requirements. For example, if you’re caught operating a vehicle without adequate coverage, you could face the following penalties:
- A $100 to $200 fine for the first offense plus penalties.
- A $200 to $500 fine for the second offense within three years of the first plus penalties.
What Other Auto Coverages Should I Buy?
For starters, state auto liability requirements are usually lower than what you need. In addition, lawsuits can be costly, if not financially devastating. So, if you don’t have adequate liability coverage to protect all of your assets (investments, savings accounts, etc.), you could put your financial well-being in jeopardy. Therefore, increasing your liability limits could be a smart move to make.
If your coverage needs exceed the limitations of your auto and home liability limits, an umbrella policy is an affordable way to get adequate liability protection. So, if you’re at fault for a catastrophic collision, umbrella coverage can protect your financial resources from a hefty lawsuit.
A few other coverages you may want to consider include:
- Collision and comprehensive insurance. Buying liability insurance alone leaves your car vulnerable to property damage. Collision and comprehensive coverage pay to repair or replace your car if it’s damaged, destroyed or stolen. Collision coverage protects your car from damage resulting from another vehicle, and comprehensive coverage covers your car from non-crash-related damage.
- Medical payments or personal injury protection (PIP). If you’re in an accident, this coverage can pay for treatment if you or a passenger is injured. In addition, coverage can include compensation for medical payments, lost wages or even funeral costs.
- Underinsured or uninsured motorist coverage (UM). If you’re struck by another vehicle and get injured, this type of coverage can pay for your medical bills if the driver at fault doesn’t have enough coverage or doesn’t have liability insurance at all. Like PIP, it can also cover your lost wages or pain and suffering resulting from the collision. With 15 percent of California drivers uninsured, according to the Insurance Research Council, uninsured motorist coverage is worth considering.
California Auto Insurance Pricing Factors
Auto insurance pricing varies drastically from insurer to insurer since each company usually uses a variety of factors when determining rates. Some factors can include your claim history, driving record, make and model of your vehicle, and level of driving experience.
California auto insurers can also use other factors, including:
- Marital status
- ZIP code
It’s important to note that California insurers cannot use your credit or gender when determining your auto rates.
Can My California Car Insurance Be Canceled?
Yes, like in other states, California law stipulates that your auto insurance can be canceled for a variety of reasons, including:
- You fell behind on premium payments.
- You, your household members or anyone who regularly drives your car had their driver’s license suspended or revoked during the policy period. Or if the policy is a renewal, during the policy period or the 180 days immediately preceding the policy effective date.
- You made a fraudulent car insurance claim.
- You misrepresented information about you, your household members or anyone who regularly drives your car, including driving records; annual miles driven in past years; number of years of driving experience; past car insurance claims; or any other factor found by the California insurance commissioner to cause a substantial risk of loss.
Auto insurance companies must give you at least a 10-day notice if they choose to cancel your policy due to missed payments. If the policy is canceled for reasons other than nonpayment, the insurers must send a 20-day notice. Any notice will be mailed to you, your lender (if you financed a car), and any interested parties.
When is A Vehicle Considered Totaled In California
Car insurance companies may decide to total your car if it’s beyond repair after a collision. California law defines a totaled car as one that is “uneconomical to repair.”
If you don’t purchase collision and comprehensive coverage, your insurer will not reimburse you for the damaged or destroyed car. Therefore, if you want reimbursement for a totaled car, make sure to purchase this type of insurance.
What If I Have a Complaint Against My Insurance Company?
Have a complaint against your current insurance company? If so, the California department of insurance can be there to assist since this organization is responsible for taking insurance-related complaints. To get assistance with your concern, visit the getting help page.
California’s Low Cost Automobile Insurance Program
To prevent drivers from forgoing auto insurance due to affordability, California has a program that makes car insurance accessible to low-income individuals and families. Visit MyLowCostAuto.com to confirm if your level of income qualifies.
Other qualification requirements include:
- You must be 16 years old or older
- You can provide proof of a valid California driver’s license
- Your vehicle is worth $25,000 or less
- You have a good driving record