If you’re a new driver, finding the right insurance can be a daunting task. We’re here to go through the details with you, step by step. The first thing to understand is that insurance is the law. The California Department of Motor Vehicles keeps track of your insurance status through your insurance company, so it’s important never to be late with a payment. Driving without insurance could result in a suspended license or impounded vehicle.
But, there are reasons beyond that to be prepared with good insurance. Think about your current financial situation.
- Do you have the savings to cover repairing or replacing your car, and for a rental in the meantime?
- Are you in a position to pay thousands of dollars out of pocket for someone else’s medical expenses?
- Even if you can afford it, are these the things you want to be spending money on?
The purpose of insurance is to protect you financially. It can’t stop an accident from occurring, but it can make sure an accident doesn’t leave you in debt.
Minimum insurance requirements in California.
These are the minimum coverages the law requires. Keep in mind that this type of coverage is called “liability” – that means that insurance payouts cover damage caused by you, but not damage done to you or your property.
- $15,000 for the injuries of any single person.
- $30,000 for the injuries of multiple people. If two or more people are injured, this is the total payout between everyone.
- $5,000 for the damage of property belonging to other people, businesses, and municipalities.
These amounts are generally quite low.
It’s important to remember that while these are “minimums” that you need according to state law, these are also the maximum amounts that an insurance company will pay out. For example;
If you accidentally hit a vehicle and cause $10,000 worth of damage, your insurance under these policies would only cover $5,000 of it. You would be responsible for paying the remaining $5,000.
You may want to consider a policy with much better protection – it’s not a good idea to cut corners on insurance policies.
In addition to higher coverage, look in to protection that covers your costs.
The minimums only cover expenses incurred by other people in cases that an accident is deemed to be your fault. It’s a good idea to seek coverage that will also handle your expenses, such as medical bills and vehicle damage. Here are some of the most common, and most vital additions to a policy:
Uninsured motorist coverage (UMC).
This is probably the most important of the additional coverages we’re going through. It doesn’t matter how responsible you are with your driving, sometimes someone else causes a collision. If they don’t have insurance, that’s a serious problem for you. It could leave you with medical bills and a wrecked vehicle, and no one to help with the expenses.
UMC covers you in that situation – your insurance company can help pay the cost of someone else’s illegal behaviour. It’s actually state law that insurance companies offer this option to you. That’s how critical it is.
Medical payments / physical damage coverage.
These two types of insurance cover you in any situation regardless of fault. This means that if you are found to be at fault for an accident, your insurance company will cover some of your expenses as well.
This is different to liability coverage. Remember that Liability coverage only covers other people’s expenses. These will cover damage to your vehicle, and the medical expenses of you and your passengers.
If you’re having trouble finding affordable insurance, there are resources to help.
Always do your research when you’re looking for insurance. Compare your budget with the different insurance plans and try to air on the side of caution. A higher deductible can reduce your monthly payments, but it can cause you a headache in the case of an accident, so be careful not to take on too much risk.
As always, Pronto’s goal is to make auto insurance accessible and affordable for all California. Get a quote here and see what we can do for you.