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.

Comparison of Loss By Vehicle Type and Size Weight 2005-2007 Models

The information in this post is based on collision coverage results for 2005-07 model passenger cars (including minivans), pickup trucks, and SUVs insured under private passenger automobile policies.

Two main factors determine collision losses. One is how often claims are filed (claim frequency). The other is how big the claim payments are, depending on the amount and severity of damage (average loss payment per claim). These two factors combine to indicate overall insurance losses, or average loss payments per insured vehicle year.


rel_claim_freq

As you can see in the chart above, very large SUVs had the lowest property claims (72), while small 2-door cars had the highest (130). For 4-door cars, we see that smaller cars had higher frequencies than larger ones. Pickups and luxury automobiles follow the same pattern. More...