How Car Insurance Works in California

California is a big state with the residential areas often being far away from commercial establishments. Public transport is minimal so having a car is a necessity. Having your own ride will let you make the most out of your stay. You will be able to drive home from your office whenever you want to and explore wonderful places on weekends.

Of course, this will cost you money from car loan payments to insurance. Fiscal responsibility is an important aspect of vehicle ownership. Learn how car insurance works in California and follow the laws to avoid headaches in the future.

Minimum Car Insurance Coverage

Your involvement in a car accident may be improbable but it is possible. In case this happens, you should be able to shoulder your liabilities without any delays for the benefit of the injured persons. The law makes sure that this happens by requiring every motorist to carry car insurance. The smallest coverage should be enough to cover liability in most situations.   

According to the California Insurance Code, one would need coverage for at least $15,000 for injury or death to a single person or $30,000 for two or more persons. As for damage to property, the minimum is at $5,000 for repairs. Should these prove to be inadequate, laws on car accident compensation in California states that motorists must pay the balance out of pocket. Opting for higher coverage values can avoid this.

Intent to Suspend Registration

Authorities may check whether a driver currently has insurance. This usually happens following a traffic violation. For example, a car may get caught speeding in the highway and was chased by the police. The driver must present his license, registration, and insurance papers. The officer will verify these for validity. If the authorities cannot confirm the insurance, then they can send a letter of intent to suspend registration. This prevents the motorist from driving until the issue clears. Make sure they receive the right information for smooth processing.

California Good Driver Discount

Another key part of the California Insurance Code is the provision to give good drivers a minimum of 20% discount for their excellent conduct on the roads. This is applicable for drivers with at least 3 years of licensed experience with an exemplary driving history. There must be no convictions in the past 10 years for DUI or certain felony convictions.  

California Teen Driving Laws

Teens can begin to drive even before their 16th birthday. However, their relative inexperience tends to make them prone to accidents. Insurance companies therefore charge them higher than average. The law also tends to be stricter when it comes to DUI and other offences. While the good driver discount can’t apply to them yet, they may be able to reduce their premium payments if they get excellent grades at school or qualify for other discounts.