Low Cost California Auto Insurance: How Minimum Liability Coverage Could Impact You
Under the California Low Cost Automobile Insurance Program
, the state's minimum liability limits have been decreased for low-income good drivers. Up until 2009, California drivers were required to carry a basic liability policy: in the event that the driver caused an accident, the other parties involved that were not at fault would receive up to $15,000 each for medical bills and other expenses related to their injuries. A total of $30,000 would be available to compensate for all of the injured parties' losses. The insurance company would pay out up to $5,000 for all property damage resulting from the accident.The minimum liability the state previously required drivers to be insured for was already insufficient to adequately compensate an accident victim for the medical expenses and property loss or damage associated with an accident. Under the states former minimum liability requirements, the lowest liability policy a driver could obtain insurance for covered up to $15,000 in bodily injury liability per a person, $30,000 in bodily injury liability per an accident, and $5,000 for property damage liability per an accident. In 2009, instead of raising the minimum liability requirements, California lowered them: $10,000 for bodily injury liability per a person, $20,000 for bodily injury liability per an accident, and $3,000 for property damage liability per an accident.
Instead of raising minimum liability limits to a level that would adequately compensate accident victims' for their losses, the state lowered them to meet the needs of low-income good drivers: $10,000 for bodily injury liability per person, $20,000 for bodily injury per accident, and $3,000 for property damage liability per accident.
The low cost California auto insurance program was created to ensure that low-income good drivers could afford car insurance. Given the recent recession-driven increase in unemployment, many California drivers have opted for this minimum liability coverage. Moreover, the states definition of a good driver includes individuals who have caused no more than one accident in the past three years, and, therefore, are quite capable of causing another collision in the years to come. In the event that one of these good drivers does cause an accident, his or her policy will fail to provide adequate compensation for the not-at-fault drivers involvedwhich was the case for the motorcyclist.
As an increasing number of the drivers we share the road with opt for low cost California auto insurance, we must protect ourselves by adding collision and uninsured motorist insurance to our policies, if we havent done so already. If the motorcyclist had this additional coverage, the collision insurance would have paid for the motorcycle repair or replacement costs and the uninsured motorist insurance would have covered any medical expenses that exceeded the negligent drivers policy. Unfortunately, he did not have such coverage and incurred a tremendous amount of debt from the accidenta misfortune any of us could suffer if inadequately insured.
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