Automobile insurance is not necessarily the simplest thing to figure out. There are terms and phrases that not everyone is familiar with (comprehensive coverage, bodily injury liability coverage, and no fault insurance come to mind), and the minimum car insurance requirements vary depending upon which state you currently reside in. Therefore, it is important that you always revisit your state's minimum vehicular insurance requirements when you're looking for a new policy or considering changing your current auto insurance policy terms.
As a California resident, you have different minimum requirements than, say, a North Carolina resident does when it comes to your car insurance. Before we jump in to the actual California minimum auto insurance requirements, let's go over the very basics when it comes to car insurance.
Vehicle insurance in and of itself helps to financially cover specific types of obligations and/or losses due to owning a vehicle—for example, it will help you pay to have your car fixed after an accident or can help to cover some of the losses incurred if your automobile is stolen or sustains damages while parked.
Bodily injury liability coverage, which is required for a driver to be legally insured in California, will pay for an individual's or individuals' (other than the insured driver) injury and/or death caused by a vehicular accident. Additionally, bodily injury liability coverage pays for legal costs if the insured driver is involved in a lawsuit regarding a vehicular accident. In California, the minimum amount of bodily injury liability coverage required is $15,000 for the death or injury of any one person in any one vehicular accident, or $30,000 for the deaths or injuries of more than one individual in any one vehicular accident.
Property damage liability coverage, also required in the state of California, will pay for damage done to another person's property resulting from a vehicular accident—if the insured driver is legally determined to be liable for the accident. Similarly to bodily injury liability coverage, property damage liability coverage will pay for legal costs if the insured driver is sued in connection to a vehicular accident. In California, the minimum amount of property damage liability coverage required is $5,000 for any one vehicular accident.
No fault insurance is not legally required in the state of California. This coverage was created to compensate victims of vehicular accidents through their own auto insurance provider, regardless of who is determined to legally be at fault for the accident.
Keep in mind that it does not matter who is driving your vehicle—the vehicle itself must have insurance. Even if the driver has an auto insurance policy on his or her own vehicle, this does not necessarily mean that your automobile is covered simply because that particular person is driving.
"What happens if I don't have the legal requirements?" you may be asking. Simply put, if you are involved in a car accident that is not covered by car insurance, your drivers license could be suspended. Additionally, if you are stopped by a police officer for whatever reason, you could face tickets and/or fines for being uninsured—in worst case scenarios, your license could be suspended in these situations as well.
Now that you know what is legally required of you when it comes to automobile insurance, go out there and do some comparison shopping so that you can be sure to get the best insurance rate available!