In California, all drivers must have car insurance or some form of financial responsibility before hitting the road. The state’s minimum auto insurance requirements include $15,000 in liability coverage for another driver’s injury, $30,000 in accident coverage, and $5,000 in property damage coverage.
While auto insurance is the easiest way to meet the financial responsibility requirement, you can choose an alternative form of coverage instead. But if you’re caught driving without insurance in California, you may have to pay fines and surrender your driver’s license.
minimum insurance requirement in california
California drivers must maintain the following minimum coverage as part of their auto insurance:
While the above coverages are required by law, other optional forms of auto insurance may be helpful to have on your policy:
california liability insurance
All drivers in California must have some form of liability coverage, which pays for injuries or damages you cause in an accident for which you are at fault.
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Those minimum limits often won’t cover full medical expenses or damage to another vehicle. you’ll likely have to pay the remaining costs, so getting higher limits to protect your assets is a good option.
clca program policy
There is one exception to the minimum coverage requirements. If you qualify for a policy through the California Low Cost Auto Insurance Program, or CLCA, you can purchase auto insurance with lower limits and still comply with state auto insurance laws. The CLCA program aims to provide affordable auto insurance to safe drivers whose family income falls within the federal poverty guidelines.
here are the minimum coverage limits with a clca policy:
is california a no-fault state?
california is not a no-fault insurance state. This means California drivers are not required by law to purchase personal injury protection (PIP) coverage.
PIP insurance covers the medical injury costs of a driver and their passengers after an accident. drivers in no-fault states also have limited ability to sue other drivers for damages.
penalties in california for driving without insurance
If you are convicted of driving without insurance, you will have to pay fines and possibly face other penalties if you are a repeat offender.
alternative types of financial responsibility
In addition to an auto insurance policy, there are three other acceptable ways in California that can prove you are financially responsible. however, not all alternatives are available for all drivers.
Cash Deposit: You can make a cash deposit that would be used to cover liability expenses if you are at fault in a car accident. You’ll first deposit $35,000 into a savings account with any bank, then contact the DMV Financial Responsibility Unit to complete and submit the application form. in the future, just make sure there is always $35,000 in that account. DMV will be able to take money out of the account and use those funds if you are at fault in a car accident.
dmv self-insurance certificate: You can obtain a self-insurance certificate from the california dmv if you have more than 25 vehicles in your name. the certificate states that it can cover medical bills, car repairs, and property damage expenses as a minimum liability policy would. Before issuing the certificate, the department may require evidence that you can meet these financial demands.
Surety Bond: You can purchase a $35,000 bond, which guarantees that it will cover medical bills, car repairs, and other property damage expenses should you be at fault for an car crash. If you are unable to pay these expenses, the bail bond company will step in, but will ask for payment later. Contact the California Department of Insurance for a list of licensed bail bond companies in California that offer this type of bond.
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