Auto insurance laws vary slightly from state to state, and it’s important to be informed about the basic rules and regulations enforced by the state’s Department of Insurance. In the state of California, all drivers are required to have proof of auto insurance when driving their own car, or some else’s vehicle. California law also requires that individuals who own a car but do not drive it have some type of auto insurance coverage.
Drivers can find extensive information about California state auto insurance laws by contacting the California Department of Motor Vehicles and reviewing the guidelines under the state’s official California Code Web Page. Here’s a brief guide to the basic California car insurance laws:
Minimum Auto Insurance Liability Coverage in California
All drivers who own and operate a vehicle in California must carry insurance with the following minimum limits:
– $15,000 for death or injury of a single person
– $30,000 for all people involved in a single accident
– $5,000 for a single accident
Financial Responsibility Requirements
California state laws allow drivers to accomplish financial responsibility in four ways:
1. Obtain coverage by a motor vehicle or an automobile liability insurance policy
2. Provide a cash deposit of $35,000 with the Department of Motor Vehicles
3. Obtain a certificate of self-insurance from the DMV for fleets of more than 25 vehicles
4. Obtain a surety bond for $35,000 from a licensed insurance company doing business in California
Rental Car Insurance Requirements in California
All vehicles driven in the state of California must be insured, even when they are rental cars. Drivers of rental cars must have some type of coverage from their regular insurance provider or obtain insurance from the rental car company before they get behind the wheel. In most cases, insurance coverage for car rentals from the driver’s regular insurance provider is less expensive than obtaining insurance with a car rental company. In either case, the driver must carry proof of insurance in the rental car at all times.
Lapse of Insurance Coverage in California
Drivers who are moving to California from another state may be at risk for a lapse of coverage and may be subject to penalties and having their vehicle’s registration suspended. Those who do not renew their insurance premium on time are also subject to penalties and fines. California legislatures have passed a bill that imposes severe penalties on motorists who allow their insurance policy to lapse.
Eligibility for Obtaining Auto Insurance in California
All auto insurance companies in the State of California determine eligibility based on a combination of the following factors: personal credit history, credit score, policy coverage type, payment history and previous premiums.
“California Department of Insurance,” Insurance.ca.gov.
“California Driving: A Brief Guide to California’s Road Rules and Driving Laws,” California Driving: A Survival Guide.