Key Takeaways
- California requires minimum auto liability limits of 15/30/5 ($15,000 per person/$30,000 per accident bodily injury/$5,000 property damage)
- California is an "at-fault" state—the person who caused the accident is responsible for damages
- The California Low Cost Auto Insurance Program provides affordable coverage for low-income drivers
- Proposition 103 mandates a 20% good driver discount for qualified drivers
- California requires electronic proof of insurance to be accepted by law enforcement
California Auto Insurance Requirements
California has specific auto insurance requirements that producers must understand.
Mandatory Coverage
California requires all registered vehicles to have liability insurance with minimum limits:
Minimum Liability Limits (15/30/5)
| Coverage | Minimum Limit |
|---|---|
| Bodily Injury per Person | $15,000 |
| Bodily Injury per Accident | $30,000 |
| Property Damage | $5,000 |
Memory Tip: Remember "15/30/5" for California minimum limits. These are among the lowest in the nation.
Proof of Insurance
California drivers must carry proof of insurance:
- Physical insurance card, OR
- Electronic proof on smartphone (California accepts electronic proof)
- SR-22 required for certain violations
- Penalties for driving without insurance include fines and vehicle impoundment
California's At-Fault System
California uses a "pure comparative negligence" system:
How It Works
- The driver at fault is responsible for damages
- Fault can be shared between drivers
- Recovery reduced by percentage of fault
- Even a driver 99% at fault can recover 1% of damages
Example
If Driver A is 70% at fault and Driver B is 30% at fault:
- Driver A can recover 30% of their damages from Driver B
- Driver B can recover 70% of their damages from Driver A
Proposition 103 Rating Factors
California law (Proposition 103) mandates specific rating factors for auto insurance:
Mandatory Rating Factors (in order of importance)
| Priority | Rating Factor |
|---|---|
| 1st | Driving safety record |
| 2nd | Annual mileage |
| 3rd | Years of driving experience |
Prohibited or Limited Factors
California restricts or prohibits certain rating factors:
| Factor | Status |
|---|---|
| Gender | Prohibited |
| Credit Score | Prohibited |
| Education | Prohibited |
| Occupation | Prohibited |
| Zip Code/Territory | Limited (not primary factor) |
Good Driver Discount
Proposition 103 mandates a 20% good driver discount for qualified drivers:
Qualification Requirements
- Licensed for at least 3 years
- No more than 1 point on driving record
- No at-fault accidents in past 3 years
- No DUI or reckless driving convictions
Discount Application
- Must be applied to base premium
- Cannot be reduced by other factors
- Applies to liability and collision/comprehensive
- All insurers must offer this discount
California Low Cost Auto Insurance Program (CLCA)
The CLCA provides affordable auto insurance for low-income California drivers:
Eligibility Requirements
| Requirement | Details |
|---|---|
| Income | At or below 250% federal poverty level |
| Vehicle | Vehicle value under $25,000 |
| Driving Record | Good driving record required |
| Age | At least 16 years old |
| License | Valid California driver's license |
Coverage Limits
- Bodily injury: 10/20 (lower than standard minimums)
- Property damage: $3,000
- Annual premium caps apply
What are California's minimum auto liability insurance limits?
Under Proposition 103, what discount must all California auto insurers offer to qualified good drivers?