What is Car Insurance?
Operating a motor vehicle comes with certain inherent risks, for even the safest drivers in California will likely be in an accident one day. Car insurance won’t prevent an accident from eventually occurring, but the insurance may provide financial assistance in the event of a covered claim. The costs of an accident can be devastating if this assistance isn’t in place.
Car insurance policies are common but also specialized. Most of these policies are package policies that have multiple coverages in them, and those coverages can typically be adjusted to suit a particular driver’s needs.
Who in California Should Have Auto Insurance?
California generally requires drivers to carry minimum amounts of liability insurance: including:
- $15,000 of personal injury liability coverage for one person
- $30,000 of personal injury liability coverage for multiple people
- $5,000 of property damage liability coverage
These minimum requirements can be met by making a cash deposit ($35,000) with the DMV, obtaining a self-insurance certificate from the DMV, obtaining a surety bond ($35,000) or purchasing auto insurance. Purchasing an auto insurance policy is the most common way to meet these requirements, and it’s the easiest the vast majority of the time.
Additionally, many drivers choose to purchase more protection than is required by state law. While extra coverage might not be legally required, only getting the minimum-required protections can leave drivers exposed to substantial risk. A single major accident could have long-lasting consequences if no extra protections are in place.