Owning a car in California comes with mandatory responsibility: auto insurance. Not only does it safeguard you and your vehicle financially in case of accidents, but it’s also the law. To steer clear of trouble, make sure you’re covered. The resources provided below can help you navigate the world of auto insurance and make informed choices when shopping for the right protection for your situation. Don’t wait, get covered and hit the road with peace of mind!

You must show financial responsibility for any vehicle that
you own, in case of injury to other people or damage to
their property. California law states,
“All drivers and all owners of a motor vehicle shall at all times be able to establish financial responsibility and shall at all times carry in the vehicle evidence of the form of financial responsibility in effect for the vehicle.”

Department of Motor Vehicles (DMV) outlines minimum limits that you must purchase under Section 16451 of the Vehicle Code. Bodily injury liability limits must meet the minimum of $15,000 per person and $30,000 total for all persons per accident. Property damage liability limits must meet the minimum of $5,000 per accident.

There are three ways to accomplish financial responsibility:

• Obtain automobile liability insurance from an insurance company authorized to do business in California.
• Make a cash deposit of $35,000 with the Department of Motor Vehicles (DMV).
• Obtain a surety bond for $35,000 from an insurance
  company licensed to do business in California.

If you do not show proof of insurance when asked, you will
get a ticket. If you do not have any insurance, your license
may be suspended and your vehicle could be impounded.

Your insurance company will provide you with proof of
insurance. It lists the insured vehicles and the name(s) of
the insured(s). It also shows the policy number and the
dates the policy starts and ends. Keep this card in your car.

Your auto insurance policy is a contract between you and
your insurance company. It explains:

• Your costs.
• Your coverages—the different things your policy covers.
• Your exclusions—the things your policy does not cover.

It is important to be familiar with your auto policy before you need it. Read it carefully. The Declarations page is a useful summary of your policy.

Good Driver Provision. Every automobile insurance company must offer coverage for Good Drivers. A Good Driver is a person who has been licensed for at least 3 consecutive years and has no more than one-point on his or her driving record. It is important to note that your rates as a Good Driver must be at least 20% lower than a non-Good Driver’s rates would be at the same insurance company.

Auto policies can vary a lot . Discuss your insurance needs
openly with your agent, broker, or insurance company.
They can help you, but it is your responsibility to choose
the insurance that is best for you. You should always get
several quotes. A quote is an estimate of your premium cost. Compare quotes before you buy a policy.

Coverage for a policyholder’s legal liability resulting from injuries to other persons or damage to their property.

Deductible – The amount of the loss that the policyholder is responsible to pay up-front before covered benefits from the insurance company are payable. This is applicable to comprehensive or collision coverage only.

Pays for damage to your car caused by reason other than collision, such as fire, theft, vandalism, windstorm, flood, et cetera.

Pays for damage to your car caused by physical contact with another vehicle or with another object, such as a tree, boulder, guardrail, structure, or person.

Provides coverage for a policyholder involved in a collision with a driver who does not have liability insurance or who does not have sufficient liability limits to pay for damages. UMC comes in two parts: uninsured motorist bodily injury (UMBI) and uninsured motorist property damage (UMPD). UMBI coverage pays for injuries to you or any person in your car when there is a collision with an uninsured driver. UMPD coverage pays for the property damage to your car when there is a collision with an identified uninsured driver. UMC must be offered when you purchase liability coverage for your auto. If you decline UMC, you must sign a declination waiver.

Medical Payments Coverage – Covers the medical costs (up to the specified limit) resulting from an auto accident for you, your family, or others in your car. This coverage pays regardless of fault.

This optional coverage pays your expenses to rent an auto if you have a loss covered under Comprehensive or Collision benefits. Coverage is sold based on a daily amount of expense subject to a maximum limit.

This coverage pays the difference between the fair market value of your vehicle and the loan balance owed to your lender. This coverage is available on new vehicles only.

Towing and road service.

• Rental reimbursement pays for car rental when your own car is being repaired after a covered accident.
• You can choose to buy these coverages. They are not
  required.