Many clients have questions about automobile insurance, which is required
under California law in order to register or operate a vehicle. This post
is intended to answer some frequently asked questions about California
auto insurance requirements.
In California, you must be able to pay for injuries or damages to others
resulting from the ownership or operation of a motor vehicle. California's
Financial Responsibility Law requires every driver and owner of a motor
vehicle to carry liability insurance as follows: $15,000 for death or
injury to any person, up to $30,000 for all persons in any one accident
and $5,000 for property damage. There are several ways to show proof of
financial responsibility, but the most common is to purchase an automobile
liability insurance policy. You must purchase a policy which complies
with the minimum liability insurance requirements above. Penalties are
very severe for failing to do so.
When your car is in an accident which determined to be your fault, your
bodily injury (BI) liability coverage will pay for injuries to others
and property damage (PD) liability coverage will pay for damage to other
people’s property. A policy with BI of $15,000/$30,000 and PD of
$5,000 will pay out as follows: The maximum limit for one person's
injuries is $15,000; if 2 or more people are injured, the maximum limit
for all will be $30,000; and the maximum limit for damage to other people's
property (their vehicles) is $5,000.
You must show proof of insurance before DMV will renew your vehicle registration.
You must also show proof of insurance when stopped by a police officer
for a traffic violation or accident. Your insurance company will provide
an insurance ID card with the description of the vehicle(s) covered, the
drivers covered, and the policy number and expiration date. This ID card
should be kept in the vehicle at all times. If you cannot show proof of
insurance, you may be fined or subject to additional penalties.
In California, driving without insurance is a serious offense. Failure
to show proof of insurance when requested may result in fines, a suspended
license, vehicle impound, or other sanctions. If a police officer asks
for proof of insurance and you can't produce it, you will be ticketed.
If you had insurance at the time, but simply could not show your insurance
ID card to the officer when he asked for it, you can have the ticket dismissed
by appearing at court and showing proof of insurance. You will, however,
have to pay an administrative fee to have the ticket dismissed. Providing
false evidence of insurance coverage is a crime.