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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