Car Insurance In California
California law requires you to have financial responsibility (commonly known as insurance) for all vehicles you operate or park. You must carry evidence of financial responsibility in your vehicle at all times and it must
be provided when:
- Requested by law enforcement.
- Renewing vehicle registration.
- The vehicle is involved in a traffic collision.
What is the Minimum Amount of Car Insurance Required in California?
The minimum amount of liability insurance you must have on your policy is:
- $15,000 for injury/death to one person.
- $30,000 for injury/death to more than one person.
- $5,000 for damage to property.
While most drivers usually just purchase a state minimum liability car insurance policy, there are actually a few other ways to satisfy the legal requirement for financial responsibility. These alternatives are usually not that common and often require a significant amount of resources. Instead of buying an insurance policy you can:
- Deposit $35,000 worth of cash with DMV.
- Obtain DMV-issued self-insurance certificate.
- Purchase a surety bond for $35,000 from a company licensed to do business in California.
What Does Car Insurance Cover in California?
Car insurance policies can range from basic to comprehensive depending on your needs. While only the minimum amount of liability is required by law, it is hardly sufficient coverage for most drivers. Here is an example of a standard amount of coverage you might find on a policy:
|Coverage Component||Example Limits of Coverage|
|Bodily Injury Liability||$15,000/$30,000|
|Property Damage Liability||$10,000|
|Uninsured Motorist Bodily Injury||$15,000/$30,000|
|Uninsured Motorist Property Damage||N/A|
|Collision Deducible Waiver (CDW)||$500|
|Rental Reimbursement||$900 – $30 per day for 30 days|
|Roadside & Towing||$100 per occurrence|
In addition to basic liability coverage, most insurance companies offer optional forms of coverage you can purchase. These include:
- Comprehensive coverage – Protects you against damages that might occur to your car that do not involve traffic accidents such as theft or vandalism damage.
- Collision coverage – Covers you against damages to your car that occur as a result of a traffic collision such as an accident with another driver.
- Medical and funeral services coverage – pays for the medical or funeral expenses of you and your passengers after an accident, regardless of fault.
- Uninsured/Underinsured motorist coverage – According to the latest statistics from the Insurance Information Institute (III) 12.6% of California drivers had no car insurance. Uninsured/underinsured coverage can cover damages caused by one of these drivers.
- Rental reimbursement coverage – Helps pay for the cost of a rental car while your vehicle is being repaired after a car accident or after suffering damages that are covered through your car insurance policy.
- Towing and roadside coverage – If your vehicle has stops running due to non-accident related events (e.g. mechanical or electrical breakdown), this coverage can be of assistance.
Who Are the Best, Most Responsive Auto Insurance Carriers?
There are over 150 California admitted insurance companies that do business in our State. So just like the vehicle you drive, your ideal insurance is distinctive to your circumstances, your preferences, and your needs. As a result, you need an auto insurance agency that offers a large variety of vetted carriers—and can find you the best policy for the best price. Here is a list of the top 50 insurance companies by market share, as of 2016. In no particular order:
- CSAA Insurance Exchange
- California Casualty
- Amica Mutual
- Government Employees Ins Co (Geico)
- California Capital
- Century National
- Progressive West
- Access General
- Financial Indemnity
- Horace Mann Prop and Cas
- State Farm
- United Financial Cas (Progressive)
- Pacific Property & Casualty
- Alliance United
- Horace Mann
- Metropolitan Direct
- 21st Century
- Permanent General
- Western General
- Everest National
- Western Home Ins
- CSE Safeguard
- National General/Integon
- Federal Ins (CHUBB)
- Pacific Specialty
- Anchor General
- Liberty Mutual
- Victoria Fire
- Coast National
- Foremost Property and Casualty
You can view the complete list here.
At Shift Insurance, we have access to 80% of the top tier carriers for car insurance in California. What’s more, we’ll never stop trying to get you the best deal possible.
Are There Discounts For Being A Good Driver?
Back in 1988, California residents voted Proposition 103 into law. Among other insurance-related regulations, Proposition 103 also created the Good Driver Discount — which requires car insurance companies to give qualifying policyholders a 20% discount.
You are automatically qualified for the discount if you have been licensed to drive (either here in California or anywhere else in the U.S. or Canada) for the past three years. And, during those three years, you have not:
- Been at-fault (meaning at least 51% responsible) in an accident
- Received more than one point on your driving record
- Gone to traffic school for more than once for a traffic violation
In November 2013 — the 25th anniversary of Proposition 103 — the Consumer Federation of America decided to find out. Their research showed that California drivers had saved more than $100 billion in those 25 years, solely because of Proposition 103.
By graphing their data we can actually see that California’s average car insurance premiums have decreased 14.3% since Proposition 103 went into effect. During that same time period, the national car insurance rate average jumped 50%. Before Proposition 103, California’s car insurance rates were rising faster than any other state in the nation.
What Car Insurance Discounts are Available in California?
Insurance companies base their rates on the amount of risk assumed to cover a driver. If you can show that you’re less of a risk, they’ll usually lowering your premiums. They do this because safe drivers file fewer claims. Here are the most common discounts associated with California policies.
- Good Driver Discount
- Pay In Full Discount
- Automatic Payments Discount
- Multi-Policy Discount
- Multi-Car Discount
- Multi-Driver Discount
- Accident Free Discount
- Affinity Group Discount
- Marriage Discount
- Alternative Fuel Discount
- Electronic Stability Control Discount
- Anti-Lock Brakes Discount
- Anti-Theft Discount
- Passive Restraint Discount
- Economy Car Discount
- Utility Vehicle Discount
- Farm or Ranch Vehicle Discount
- Persistency or Renewal Discount
- Prior Insurance Discount
- Defensive Driving Discount
- Good Student Discount
- Low Mileage Discount
- Vehicle Monitoring Discount
- New Car Discount
- Prior Insurance Discount
- Organization Membership Discount
- Senior Discount
- Annual Term Discount
What Happens if I Get A DUI, DWI, or a Wet Reckless in California?
Getting a DUI can be a long road to recover from. For first offenders, the average cost of a DUI in California can range between $6,000-$10,000 according to the Alcohol and Drug Program department in California. There are also many hurdles to over come like an automatic driver’s license suspension, mandatory probation, community service and drug and alcohol education classes.
Here is a general itemized breakdown for a first offense:
- Fines and penalties — $1,500
- Towing and impound fees — $215
- First offender program course — $626
- Court Costs — $800
- Insurance Increase — $2,700
- Attorney Fees — $2,500
- Restitution Fund — $500
- DMV License Reissue Fee — $125
- Total Approximate Cost — $8,966
To get your license back you must be able to provide proof of insurance to the DMV. Unlike insurance for non-DUI offenders, the DMV must know about the status of your insurance at all times. It is extremely important to maintain a consistent SR-22 for the entire duration of your required period (usually 3 years). If you did not know, a suspension stays on your driving record and counts against your insurance rates for 5 years. Every time you lapse your insurance policy or cancel it, the DMV is notified and your license is automatically suspended again. If this happens, you will earn another suspension period on your driving record and your 5 years starts over.
How Do Tickets and Accidents Affect My Insurance Rate?
The penalties for traffic tickets are consistent throughout all counties in California.
Points issued will depend on the traffic violation. Violations such as speeding, making an unsafe lane change, or anat-fault accident will give you lower points than serious violations, such as reckless driving, hit-and-run, DUI, or driving with a suspended or revoked license.
Here in California, we have a point system. Every time you get a ticket, cause an accident, or commit some other driving violation, points are added to your license. If you get enough points in a certain amount of time, the California DMV can suspend your license or revoke your driving privileges altogether!
Here’s how it works:
- If you get 4 points in 12 months, you can lose your license.
- If you get 6 points in 24 months, you can lose your license.
- If you get 8 points in 36 months, you can lose your license.
Just remember, the court may give you the option to have points removed from your record upon completion of a court-approved traffic course.
Who Is Allowed to Drive My Car and Still Be Covered By My Insurance?
Anyone listed on your policy as a “rated driver” or an occasional, unexpected driver.
For example, if you loan your car to a neighbor one time, odds are your insurance coverage will kick in if he gets into an accident. But if you let your neighbor borrow your car every week to go to the grocery store, he’ll need to be listed on your insurance policy if you want to have coverage.
California has a law called “Permissive Use”. In layman’s terms, it refers to letting someone drive your car who isn’t listed on your insurance policy. Remember, your policy comes with a list of drivers who benefit from your insurance coverage whenever they’re behind the wheel. Your insurance company uses this list to help determine your premium rates. So, if your teenage son is listed as a driver on your policy, you’ll likely pay higher rates (after all, he comes with more risk!), but at least you know he’ll be covered if something goes wrong.
Permissive use also covers people like mechanics who drive your car around the block, or someone who wants to test drive your car before they buy it. It can even cover relatives who don’t live with you. However, if you let someone who lives with you borrow your car, they won’t be considered a permissive use driver — no matter how infrequently they actually get behind the wheel.
Can I Use an Electronic Copy of My Insurance Card as Proof?
Yes. In 2012, California became the first State to allow drivers to provide a digital version of their proof of insurance by passing Assembly Bill 1708. Basically the bill allows you to show proof of insurance directly from your cell phone or mobile device.
How Do I File an Insurance Claim In California?
1. Stop. You must stop after any collision or you may be charged with a “hit and run”.
2. Check to see if anyone needs medical attention. Your first priority, regardless of how upset you are, is to make sure that anyone who needs medical attention is taken care of. Call 911 or your local authority for immediate assistance.
3. Keep yourself and other safe. If no one is injured or killed, move your vehicle off the street or highway. If you do not move your vehicle or have it removed from the street or highway, any peace officer or authorized personnel may have your vehicle removed and impounded (CVC §§22651 and 22651.05). If you cannot get out of your car or it is not safe to try, keep your seat belt fastened, turn on your hazard lights, call 911, and wait for help to arrive.
4. Contact the authorities. It is important to note that the authorities will sometimes try NOT to respond to an accident unless somebody is injured or needs medical attention. With that in mind, it is extremely beneficial and important to have an officer come out and file an incident report. If they will not respond, it is important to get unbiased 3rd party testimonials on the incident and file an incident report as soon as possible.
5. Look for witnesses. Get as many 3rd party accounts of the incident as possible. This will help the insurance company adjusters determine fault especially if there is no police or incident report.
6. Document everything and exchange information. You are required by law to exchange information with all parties involved. You will want to gather as many details about the accident as possible. The more evidence you collect, the better chance you have to receive fair compensation from an insurance company. You may want to have a form for documenting traffic collisions and for recording as many details about the accident as possible such as the “Shift Insurance Accident Cheat Sheet” listed below.
7. Report the accident to the Department of Motor Vehicles. Regardless of who is at fault, you must fill out and submit an SR1 form within ten days of the collision to the DMV if:
- There was property damage of more than $750 or
- Anyone was injured (no matter how minor) or
- Anyone was killed
8. Contact your insurance company to report the claim. Make sure to provide all the documentation and evidence you collected in the prior steps to your claims adjuster.
What if I Can’t Afford Insurance?
California offers a Low Cost Auto Insurance program (CLCA) designed to help good drivers that are income eligible afford an auto insurance policy that meets the state’s mandatory minimum requirements. Each policy provides liability coverage for the vehicle’s primary driver and eligible secondary drivers. To qualify a driver must meet all of these criteria:
- Must have a valid California driver’s license
- Meet specific income eligibility requirements
- Own a vehicle $25,000 or less
- Be at least 19 years of age
Simplify Your Life—Leave the Jargon to Your Insurance Experts
We know this business inside and out, and we’re experts on the features of every type of insurance—including other lines like home, motorcycle, and boat. We have a keen understanding of what kind of coverage is adequate for different customers—and why. Leave the insurance-speak to us. We’ve got you covered.
And remember the cheapest option isn’t necessarily the best—but paying more doesn’t always mean getting more, either. We’ll find the plan that’s ideal for your family and your life, at a price that’s right for your budget. We do the work; you reap the benefits.
Shift into gear with quality insurance. Call us today.