California Car Insurance Laws
If you drive an automobile in California, state law dictates that you must be financially responsible for your actions. All drivers must show their ability to pay for damages or injury to others resulting from the ownership or operation of a motor vehicle.
Financial Responsibility Laws California’s Compulsory Financial Responsibility Law requires every driver and owner of a motor vehicle to be financially responsible for their actions. The statutory minimum limits of liability insurance in California are as follows:
Bodily Injury
$15,000 for death or injury of any one person, any one accident.
$30,000 for all persons in any one accident.
Property Damage
$5,000 for any one accident.
There are four ways to accomplish financial responsibility:
- Coverage by a motor vehicle or automobile liability insurance policy;
- A cash deposit of $35,000 with the Department of Motor Vehicles (DMV);
- A certificate of self-insurance issued by DMV to owners of fleets of more than 25 vehicles; or
- A surety bond for $35,000 obtained from an insurance company licensed to do business in California.
What Could Happen If I Ignore This Law?
The most common way drivers choose to comply with the financial responsibility requirement is by purchasing an automobile liability insurance policy. If you have an accident not covered by insurance, then your license may be suspended. It is your responsibility to provide liability insurance for any vehicle you own regardless of who is operating the vehicle. It is illegal for those vehicles to be operated without meeting the requirements of this law.
California Insurance Regulations
California Auto Insurance Consumer Guide
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