What Low Income California Drivers Need to Know About the California Low Cost Auto Insurance Program

Article by Cliff Berman

Rising unemployment rates and the exorbitant cost of gas have left hundreds struggling to come up with the fund they need to keep their car properly insured. That’s why over 15% of drivers on the highways today are driving uninsured, 3 million plus in California alone. In an effort to stem the rising tide of uninsured drivers California has implemented an insurance program designed especially for low income drivers known as the California Low Cost Auto Insurance Program.

Unlike regular insurance programs, which are designed to work on a fixed rate premium depending on your circumstances, the California Low Cost Auto Insurance Program (CLCA) works on a sliding scale determined by your income. Drivers that meet the definition of financial need established by the governing authority can aply to be admitted into the program and enjoy the benefits of a low cost insurance policy designed especially to meet their needs.

This isn’t one of those low cost insurance programs designed to persecute the middle class just because they happen to make enough money to keep food on the table and pay their rent on a semi-regular basis. Instead, the program is designed to accommodate the bottom edge of the middle class, with a family of four being permitted to have a combined income of up to ,000-considerably higher than the state poverty level.

With an income level this high the hope is that every driver will take the initiative and apply for the California Low Cost Auto Insurance Program rather than choosing to continue to drive uninsured.

Because California has a mandatory liability requirement for its drivers the CLCA only offers liability coverage as part of its low cost insurance plan. Included in the plan is:

* ,000 Bodily Injury Liability per person.* ,000 Bodily Injury per accident.* ,000 Property Damage per accident.

As you’ve probably already noticed, this is significantly less than California’s minimum liability requirements for drivers. State officials are willing to make a trade off in exchange for dramatically reducing the number of drivers they have out there driving uninsured. Auto insurance companies have no choice about offering this low cost insurance to their clientele, but they reserve the right to keep their coverage levels low to encourage drivers that can afford it to seek regular coverage.

Collision and comprehensive are not included as part of the California Low Cost Auto Insurance Program. You can, however, purchase them separately from your insurance carrier without affecting your eligibility for the program. Most companies do offer you the chance to purchase additional medical coverage and uninsured motorist at a low cost through the program to protect yourself from the people out there who weren’t as quick to pick up on this great deal as you were.

The California Low Cost Auto Insurance Program is an ideal solution for low income drivers who don’t want to have to sacrifice their auto insurance coverage to keep dinner on the table. If you’re struggling to pay your premiums but don’t want to join the ranks of the uninsured contact the CLCA as soon as possible.

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California Auto Insurance: Low Cost Insurance For Low Income People

Article by Jim Bassett

California state law requires that every car be insured with minimum liability insurance in order to drive it on the state highways. In spite of the law, California has an enormous problem with uninsured drivers simply because they can’t afford the premiums for car insurance. In an effort to solve that problem, California developed the low cost California auto insurance plan for residents who are considered to be low income.

This liability coverage is a 10/20/3 policy. This means they have insurance coverage that will pay ,000 bodily injury per person with a ,000 limit per accident. It, also, covers ,000 in property damages per accident.

This is not a lot of coverage in the case of a serious accident, but it is certainly better than no coverage at all. The state has been able to provide this car insurance for less than 0 a year, making it affordable to the majority of the low income people.

There are certain requirements for eligibility. The driver has to be 19 years old or over, and he must have been a continuously licensed driver for the past three years. He must be able to qualify as a good driver, his car must be worth less than ,000 and he must meet the income eligibility rules.

There are five different ways that a person can pay for low cost insurance. They can pay the total of the premium in one payment, they can pay 5 immediately and the rest in 30 days, they can pay 0 down and have the rest divided into six payments that will be paid every two months, they can pay 5 down and pay the rest in five bi-monthly payments or they can pay a 15 percent deposit and the rest in 6 payments on a bi-monthly basis.

The car owner cannot choose the insurance company that he wants. When he applies for the program, he will be randomly assigned to a specific company. This is done in order to protect the insurance companies of California.

The state law requires a 15/30/5 liability policy for all drivers that do not qualify for the low cost car insurance. This means ,000 in bodily injury per person with a total of ,000 per accident. It, also, covers ,000 in Property Damage coverage.

In order to register a vehicle, the owner must show proof of financial responsibility. He can do this in four different ways. The first is showing that he has the minimum liability insurance required by the state of California. He can deposit ,000 with the DMV, he can show a certificate of self insurance that is issued by the DMV or he can present a surety bond for ,000 from a company within the state of California.

Every driver must notify the DMV before he cancels his insurance policy. If he doesn’t, the registration on his car will be revoked. If this happens, it means added expense for him.

California is doing everything they can as a state to make sure that every motorist is insured. Even with that, there is always the possibility of having an accident caused by an uninsured motorist. It is best to purchase uninsured motorist coverage as well, so you will be safe when you drive in California.

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