California Car Insurance Law

Car insurance laws in California set minimum requirements for the auto insurance coverage a standard driver must have:

California has lower required coverage limits for members of the California Automobile Assigned Risk Plan.

$10,000 Bodily Injury Liability (per person)
$20,000 Bodily Injury Liability (per accident)
$3,000 Property Damage Liability

Insurance companies in California offer Uninsured Motorist Coverage, but it is not required by law.

California is an at-fault state and assigns fault in an accident to one party. The California court system mandates that the party found to be at fault, and their insurance company must be held responsible for the damages incurred in the accident. California allows a statute of limitations of three years for legal and insurance claims against someone at fault in an accident.

California has a Financial Responsibility law. If a driver chooses not to purchase auto insurance, they need to prove they are financially responsible in one of three ways:

1. Depositing $35,000 in cash with the California Department of Motor Vehicles (DMV)
2. A certificate of self-insurance issued by the DMV to owners of fleets of more than 25 vehicles
3. A $35,000 surety bond that is obtained from a licensed California insurance company.

Tips To Help You Buy Car Insurance On The Internet

Commercials make it seem so easy to get car insurance on the internet. All you have to do is point, click, and pay. There are a few steps in between, but a few minutes of advance preparation and you will find it really is almost that easy. Make sure you are getting online quotes the easy way by following some simple tips.

  • Get your paperwork together before you begin shopping. When you have your information together it is much easier to enter it into multiple sites quickly. You get the best price faster.
  • Don't get distracted. Have an hour or two set aside and pay attention to every quote. The last three companies may have had the same questions for quotes - that does not mean the next company will. Stay alert.
  • Reduce the noise level. If you have kids or pets in the home that make noise, find a way to tune it out while you are getting your quotes online. If your kids are younger, schedule a play date and get your online quotes while they are at a friend's house.
  • Know your priorities. Know what you find most important on your auto insurance policy. If a company has great rates and wonderful customer service but does not offer roadside assistance - ask yourself if you really need it. You may already have roadside assistance through your cellular phone or through a company like AAA. Don't pass on a great policy with a great rate because of something small.

Get started with your FREE online quote now. It could save you hundreds of dollars.

2 Myths About Buying Car Insurance Online

Two of the most asked questions about buying car insurance online were: "How do I know my rate is accurate?" and, "I have a situation I need to explain." This articles dispels the myths associated with each of those questions.

How do I know my rate is accurate?

Before car insurance companies set up Web sites for you to put your information directly into, your rate was still calculated via computer. Your agent had access to the computer, or faxed over your information and the underwriting department calculated the rate. Insurance companies take the same algorithm they have always used for risk measurement and allow customers to get a rate without involving an agent. Agents have always been able to access these algorithms, but it saves the insurance company money to let the customer do it directly. You save money in many cases because the insurance company does not have to pay an agent's commission when you purchase online.

I have a situation I need to explain

Many drivers have special situations. When you go through the questionnaire online and answer the questions, pay close attention and see if one of those questions deals with your special situation. If you do not see anything pertaining to your situation and are still worried, call customer service and ask. Customer service representatives at car insurance companies are well-versed in special situations and can walk you through what to do next.

Get started with your FREE online quote now. It could save you hundreds of dollars.

What is a Fleet Vehicle?

A fleet vehicle is essentially a vehicle that a company uses during operations of a company. Fleet vehicles are owned or leased by the company. Vehicles which are used in the normal operation of a company, but are owned by company employees are not fleet vehicles.

Some examples are vehicles operated by car rental companies, taxi companies, public utilities,  bus companies, and police departments and government cars.

The definition for fleet varies by state and by insurance companies. The number of vehicles owned by the business to be considered a fleet may vary. If your state does not have its own definition that governs insurers then each insurer in your may have different guidelines to determine how many cars are required to make a fleet.

How do points affect auto insurance rates?

Moving violations, parking tickets, at-fault accidents, or driving under the influence, are assigned a certain point value. When you are found guilty of one of these infractions, the appropriate number of points is added to your driving record. The more points you have, the worse your record. Each insurance company has its own method of evaluating applicants, so the points on your driving record may or may not have a direct impact on the rates you pay for auto insurance.

A point system is simply the assignment of "points" or values to each infraction. Then, the rating system of the insurance company evaluates the "points" instead of each infraction. For example, a company may use this type of system:

Infraction

Points 1stOccurrence

Points 2ndOccurrence

Points Each Additional Occurrence

At-fault Accident

2

3

2

Driving Under the Influence

1

2

3

No Charge Violation

0

0

0

Major Violation

4

4

4

Minor Violation

2

1

1

Not-at-fault Accident

0

0

0

Speeding

3

2

2


Because each insurance company has a different (complex) rating algorithm there is no set dollar amount or rating point comparison that can be given. If you want to find the specifics for your insurance company, their rates are filed with the state's department of insurance. You can request a copy of those rating factors and how they affect the companies' specific rates. It is very complex and not for the faint of heart.

Typically, you can expect the company rating algorithm to try to put an insurance point value on each infraction (regardless of the state driving record point system). Based upon that point value a different rating factor is use to either raise or lower the rate. Again, it is different for every company. Some companies rating algorithms are much more complex and some are simple.

One major violation can increase your rate by 26%. Then, most rating systems gradually lower the impact each year.