California Auto Insurance Requirements And Laws

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Written by Auto Accident Team

Last Updated: November 13, 2024

When driving in California, understanding the state’s car insurance requirements and California car insurance laws is crucial for ensuring you are both legally compliant and financially protected. Car accidents are a common occurrence, and without the right coverage, you could find yourself in a difficult position, facing out-of-pocket expenses for damages and injuries.

In California, car insurance is mandatory, and knowing the laws will help you avoid potential penalties and ensure you have the right protection if an accident occurs.

At the Auto Accident Team, we connect accident victims with qualified car accident attorneys who can help navigate the typically complex process following a collision. Whether you are unsure of your coverage or need to make a claim after an accident, our network of experienced attorneys is ready to assist. Knowing what is required of you as a driver in California is the first step toward protecting your rights on the road.

What Types of Insurance Are Required Under California Car Insurance Laws?

California law requires every driver to carry a minimum amount of bodily injury liability insurance. Liability coverage helps protect you financially if you are found to be at fault in an accident. The state’s minimum liability coverage limits are as follows:

  • $15,000 for injury or death to one person

  • $30,000 for injury or death to more than one person

  • $5,000 for property damage

These are the minimum amounts, but many drivers opt for higher limits to provide better protection. While these minimum coverage amounts allow you to drive legally, they may not provide sufficient financial protection in the event of an accident, so consider higher limits for better security.

Liability insurance only covers damages to others, not your own vehicle or injuries. If you want additional coverage for your own car, you will need to look into comprehensive or collision insurance.

These types of policies are not required by law, but they are highly recommended, especially if your car is financed or leased. Collision coverage is essential for paying damages resulting from accidents involving other vehicles, providing comprehensive protection on the road.

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Understanding Uninsured and Underinsured Motorist Coverage

In addition to liability coverage, California drivers are typically advised to consider uninsured and underinsured motorist coverage (UM/UIM). This type of insurance helps protect you if you are in an accident with a driver who either has no insurance or whose insurance does not fully cover your damages. While California law does not require this type of coverage, it can be a valuable addition to your policy. Additionally, exploring various auto insurance coverage options can provide better financial protection beyond the state’s minimum car insurance requirements.

Uninsured motorist coverage can pay for your medical expenses and property damage when the other driver is at fault but has no insurance. Underinsured motorist coverage, on the other hand, kicks in when the other driver has insurance but their policy limits are too low to cover the full cost of your damages. These coverages can prevent you from having to pay out-of-pocket after an accident that was not your fault.

Many insurance providers will automatically include UM/UIM coverage in their policies, but it is important to review your policy to ensure you have this protection. If you decide to reject this coverage, you must do so in writing. Given the number of uninsured drivers on the road, opting for UM/UIM coverage can be a wise choice to safeguard yourself financially. It is crucial to carry insurance that exceeds the minimum legal requirements to protect yourself and your assets in the event of an accident.

California’s No-Fault Law and Legal Consequences of Non-Compliance

Unlike some states, California operates under a fault-based system, meaning the driver who is found to be at fault in an accident is responsible for paying for the damages. This differs from no-fault states, where each driver’s insurance covers their own damages, regardless of who is at fault. This distinction is important, as it impacts how claims are handled and how insurance payouts are distributed. California car insurance coverage must meet specific state requirements to ensure adequate protection for all drivers.

Bodily injury liability coverage is a mandatory insurance requirement in California, with minimum coverage amounts of $15,000 per person and $30,000 per accident.

If you are caught driving without the required insurance, California imposes strict penalties. These include fines, potential vehicle impoundment, and even the suspension of your driver’s license. The fines can range from $100 to $500 for the first offense and increase with subsequent offenses.

Additionally, if you are involved in an accident without insurance, you could be personally liable for the other driver’s medical bills, property damage, and other costs. It is critical to ensure you are carrying the proper insurance at all times to avoid these serious consequences.

What to Do After an Accident in California

If you are involved in an accident in California, the first step is to ensure the safety of everyone involved. Call emergency services if necessary and exchange information with the other driver, including insurance details and contact information. It is also important to document the scene, taking pictures of the damage and any injuries that may have occurred.

Having adequate insurance coverage, such as medical payments coverage, is crucial to address medical expenses after an accident.

After addressing the immediate aftermath, notify your insurance company as soon as possible. California law requires you to report an accident to the Department of Motor Vehicles (DMV) within ten days if the accident resulted in injury, death, or property damage exceeding $1,000. Failure to report the accident could result in the suspension of your driver’s license.

Being informed about the laws surrounding car insurance in California can help you navigate the aftermath of an accident more smoothly. While insurance provides a financial safety net, the process of dealing with claims and negotiating with insurance companies can be complicated, especially when fault is disputed. This is where having legal guidance becomes invaluable.

Why Contact The Auto Accident Team?

Navigating California’s car insurance laws can be overwhelming, especially after you have been involved in an accident. At the Auto Accident Team, we connect you with attorneys who are licensed in California and well-versed in the state’s insurance requirements. You may need help dealing with insurance companies, negotiating fair compensation, or understanding your legal rights—and that is where the attorneys we work with come in.

The attorneys in our network have a proven track record of helping accident victims get the compensation they deserve, whether through negotiation or litigation. If you need support with your claim or are unsure where to start, fill out our contact form or call (877) 236-2391. We are here to help.

Frequently Asked Questions

What are California car insurance laws, and what do they require from drivers?

California car insurance laws mandate that all drivers carry at least the state’s minimum liability insurance coverage. This includes $15,000 for injury or death to one person, $30,000 for injury or death to multiple people, and $5,000 for property damage. These limits ensure that drivers can cover damages if they are at fault in an accident.

Uninsured motorist insurance helps cover medical expenses and property damage if you are in an accident caused by a driver without insurance. Although it is not required under California car insurance laws, it is highly recommended to safeguard yourself financially against uninsured or underinsured drivers.

Liability insurance covers damages to other parties when you are at fault in an accident, but it does not cover your own vehicle. Collision coverage, on the other hand, pays for damage to your car resulting from a collision, regardless of who is at fault. While not required by law, collision coverage is advisable for better financial protection.

Drivers who fail to meet California’s auto insurance minimums face strict penalties, including fines ranging from $100 to $500, vehicle impoundment, and possible suspension of their driver’s license. Additionally, if an uninsured driver is involved in an accident, they could be held personally liable for medical bills, property damage, and other costs.

Notifying your insurance company after an accident ensures that your claim can be processed promptly. California law also requires you to report accidents involving injury, death, or property damage exceeding $1,000 to the DMV within ten days. Failure to do so can result in the suspension of your driver’s license, making prompt communication with your insurer critical.

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