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California requires you to have some amount of insurance to drive legally. To be specific, you’ll need liability insurance, which covers others’ injuries and property damage if you are the at-fault driver in an accident.
Here’s everything you need to know about liability insurance in California.
What does liability insurance cover in California?
You can think of liability insurance in California as a way to cover two different things:
Liability insurance does not cover your own injuries or property damage, but it may cover your legal expenses if you’re sued by another driver.
Your insurance policy may include several types of coverage, but they don’t all cover the same things. Understanding the different sections of your policy can help you know what’s available if you ever need to file a claim.
» MORE: What does car insurance cover?
How much liability insurance is required in California?
California drivers are required to maintain a minimum amount of liability insurance. Specifically, an auto policy needs to have at least:
$15,000 in bodily injury liability, per person.
$30,000 in bodily injury liability, per accident.
$5,000 in property damage liability, per accident.
Here’s an example of how these minimum limits work if you cause an accident: Your auto policy will pay up to $15,000 in medical bills for the other driver’s injuries. If more people are involved, your bodily injury liability coverage will cover up to $30,000 in medical bills for all injuries sustained from the accident — but not more than the $15,000-per-person limit. If you damage any property, your policy will cover up to $5,000 in property damage, whether that damage is to another car, a picket fence or a glass storefront.
While these amounts may seem like more than enough coverage for most accidents, liability insurance only covers others’ expenses after an accident that you cause, and those costs can easily exceed California’s minimum liability limits. If you want more extensive financial protection, consider purchasing higher limits and additional coverage types.
Should I get more than just liability insurance in California?
While liability insurance is the only coverage you must have on your policy, California law also requires insurance companies to offer uninsured and underinsured motorist coverage. You can reject these coverage types in writing, but they can be valuable, since they pay out if you’re hit by an uninsured or minimally-insured driver. An estimated 16.6% of California drivers don’t have car insurance, so you may want to keep these coverage types if you can afford them. Think of it as planning ahead, just in case.
Below are some common types of car insurance worth considering for California drivers.
What it pays for
Your medical bills and property damage costs if you’re in an accident with another driver who doesn’t have car insurance.
Your expenses if you’re in an accident with another driver whose policy limits aren’t high enough to cover your medical or repair bills.
Medical expenses for you and your passengers, regardless of who’s at fault for the accident.
Damage to your own car from a collision with another vehicle or an object like a tree, fence or mailbox.
Damage to your car from things outside of your control, whether that’s a force of nature, vandalism or even theft.
*If you lease or finance your vehicle, you may be required to add collision and comprehensive coverage to your policy.
» MORE: The 8 key types of car insurance
California’s Low Cost Auto Insurance program
The state of California offers a low-cost insurance program if you're unable to find a policy that both fits your budget and includes the required liability insurance limits.
This program offers lower liability limits as an exception to the state's minimum requirements. So while you'll have less coverage if you cause an accident, you're at least able to legally drive in California.
However, California’s Low Cost Auto Insurance program is income-based, so not every driver will qualify. (You can review the qualifications on the program's website.)
Drivers who qualify for this program can purchase liability limits of:
$10,000 in bodily injury liability, per person.
$20,000 in bodily injury liability, per accident.
$3,000 in property damage liability, per accident.
Qualified drivers can also add uninsured motorist and medical payments coverage for an additional cost. If they want to add comprehensive or collision coverage, they'll need to purchase it separately from an insurance agent.
California’s low-income insurance policies can be a source of financial relief for qualified drivers. However, the program’s low liability limits may not be enough to cover costs of injuries and property damage if you cause an accident, especially after a bad crash. If you can afford it, you should purchase an auto policy with higher coverage limits from an insurance company.