Auto Insurance in California – What You Need Now & Savings on the Way

February 27th, 2010 by admin

As with most states, California state car insurance law requires all motorists to carry three fundamental liability components.

Bodily Injury Liability or BIL of $ 15,000 per person

Total Bodily Injury Liability (Total BIL) of $ 30,000 for each accident

Property Damage Liability (PDL) of $ 15,000 per accident

The insurance industry refers to this as 15/30/15.

However, to rely solely on this amount of coverage, would be foolish. Multiple pile-ups and ambitious lawyers often drive the cost of a vehicular accident to well beyond six figures. If you’re at fault and you’ve gone with the minimums, you personally, are now on the hook for the shortfall. So, you must sell your house, empty your bank account and probably alot more…how does that sound?

From experience, I recommend no less than 100k/300k/100k and more, if you are on the road frequently…particularly in the abundant elite communities of Californ-i-a. Spending a few more dollars here is value for money.

Thus far, we have discussed only liability insurance which doesn’t cover your injuries and damages to your car. The rest of what we will discuss is not required by CA law.

First, let’s take care of you. Personal Injury Protection (PIP) covers injury to you and/or your passengers. I suggest PIP coverage of no less than $ 100,000.

Next, your vehicle. To most people, having both collision and comprehensive insurance is known as full coverage.

There are two purposes of collision insurance; to cover the cost of damages to your vehicle or, if your car is a total write-off, to provide a cash settlement. You must pay for a predetermined deductible, & the insurer pays for the rest.

Comprehensive covers your ride for vandalism, theft and damages due to fire, animals and acts of God.

Another vital coverage is protection against uninsured drivers. It’s not your fault, but he can’t pay…your uninsured driver coverage kicks in.

Auto insurance Southern California introduces “pay-by-mile” program.

California’s Insurance Board has put forth a proposal to allow insurers to charge consumers based on miles traveled. Just like buying prepaid minutes for your cell phone…you would pay in advance for a specified number of miles to be traveled in a fixed period of time. A monitoring device installed in the car will allow insurance companies to observe a driver’s car usage and charge accordingly.

Consumer advocates are in favor of the proposal because charging for miles driven (as opposed to an insurance company’s projection) should mean savings to low mileage motorists.

And some say more importantly, it will incenticize drivers to stay off our roads. Environmentalists predict this type of auto insurance La Mesa will encourage consumers to drive less…meaning lower fuel usage, reduced pollution and less congestion on the road.

The plan looks like an all-out winner to me.