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California Car Insurance Requirements

California Minimum Car Insurance Requirements

The state of California requires all drivers to carry liability insurance. As with many other states, they have a mandated minimum amount of liability coverage drivers must carry. Failure to do so can result in some steep penalties. The mandatory minimum liability insurance coverage for California is:

  • $15,000 for bodily injury per person
  • $30,000 for bodily injury per accident
  • $5,000 for property damage per accident

These are just the mandated amounts for the state of California. If you lend or lease a vehicle in the state, you may be subjected to additional insurance requirements by your lender or leasing company. All drivers in California must carry proof of coverage and be ready to present it when requested.

California Liability Coverage

As mentioned above, California requires all drivers to carry liability insurance. Liability insurance pays for injuries and damages you cause in an accident. This type of insurance will never cover your own personal expenses following an accident. Additional coverage must be purchased for that. Liability coverage only offers assistance to the other party.

Car Insurance Limits in California

The maximum amount your insurance company will pay for is determined by the limit you set when purchasing. California, as outlined above, sets its minimum limits which means that the lowest amount of liability insurance you can purchase in order to legally drive. California functions on a 15/30/5 policy which each number serves its own purpose.

  • Bodily injury coverage per person refers to the maximum amount of money your insurer will pay out for one person injured in an accident you caused. In the state of California, for the mandatory minimum liability coverage, that amount is set at $15,000.
  • Bodily injury coverage per accident is the amount your insurance company will pay for all injuries you have caused in an accident. In California, that limit is $30,000.
  • Property damage per accident refers to the highest amount your insurer will pay for any damage you cause in an accident. California set the state-mandated limit at $5,000 if obtaining the minimum liability coverage.

Is California’s Mandatory Insurance Minimums Enough Coverage?

In short, no. California’s mandatory minimum liability insurance coverage amounts will not be enough if you end up in an accident. The cost of an accident can be very high. Looking at the minimum amount of property damage required, $5,000 will barely be able to cover any vehicle if the other party needs a new car. Medical expenses can also get very costly after an accident. Whatever is not covered can come back to you to pay on your own. Not to mention you have to worry about the damages and injuries you sustain in an accident. Liability does not cover you or your passenger(s). Driving with only the state-mandated minimum coverage can be very risky.

Driving Without Insurance in California

Failing to carry the proper amount of insurance to legally drive is a serious offense in the state of California. If unable to provide proof of coverage, you could be facing:

Fines (starting at $100, can increase depending on your car)

Penalty assessments

SR22 requirement

Reinstatement fees

License suspension

Additional Types of Car Insurance in California

California only requires drivers to carry liability insurance, but there is a wide variety of other types of insurance you can add to your policy. Outlined below are the policy add-ons you can purchase to strengthen your car insurance policy. The coverage these types of insurance offer can help you and your passenger(s) following a severe car accident.

  • Collision: Collision coverage helps pay for damage to your vehicle regardless of who is at fault for the accident.
  • Comprehensive: This covers any damages your car sustains when it is not in use. Such damages may be a result of theft or extreme weather. Comprehensive coverage is usually paired with collision, and when bought together, they comprise what is known as full coverage car insurance.
  • Medical Payments: Regardless of who is at fault for the accident, medical payment insurance can help cover medical costs you and your passenger(s) accumulate after an accident. It also helps with lost wages and funeral expenses.
  • Rental Car Reimbursement: If your car is seriously wrecked after an accident, rental car reimbursement insurance will help you cover the costs of renting a temporary vehicle while yours is in the shop.
  • Loan/Lease Payoff: Some accidents are so severe that your car ends up totaled. If you have been leasing or an auto loan, loan/lease payoff can be added to your policy to cover the difference between what you owe and your car’s value.
  • Roadside Assistance: What is offered may vary by insurance companies, but, in general, roadside assistance will assist you when you are stranded on the side of the road due to a mechanical issue. This could stem from a flat tire or dead battery.
  • Uninsured Motorist Coverage: Despite car insurance being mandated by nearly every state, some drivers choose to forego purchasing a policy. For these reasons, it may be helpful to obtain uninsured motorist coverage. This type of insurance will offer financial help if the other driver’s insurance is nonexistent. You can also purchase underinsurance motorist coverage for those drivers who have inadequate car insurance.

Car Insurance is Important For Any California Driver

Car insurance is mandated for all drivers in the state of California. Not only should you carry it to obey the law, but it can also offer a lot of assistance after a tragedy. Accidents can happen to anyone, and it is very important to prepare as best as you can. It is highly recommended that you purchase beyond California mandated liability insurance minimums. You are going to want protection for yourself and any passengers you may have. It can be very beneficial financially following an incident.

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