Car Insurance Requirements for Drivers in California

For any vehicle parked or operated on a California roadway, an owner must be able to show financial responsibility. Drivers must show financial responsibility for a vehicle when it is requested by law enforcement, when they renew the vehicle’s registration, and when the vehicle is involved in any traffic collision. To prove financial responsibility, most drivers must show evidence of a liability insurance policy, which is a policy that compensates another individual when the policy holder is responsible for property damage or injury.
Drivers must maintain a minimum level of liability insurance coverage on their policies. Operators of private passenger vehicles must carry a policy that includes at least $15,000 of injury/death liability California auto insurance coverage for any one person involved in an accident, at least $30,000 worth of injury/death liability coverage for accidents involving more than one person, and at least $5,000 worth of coverage for damage to property. An individual who is found to be driving without minimum coverage may incur a penalty. Drivers who cannot afford the minimum coverage may be eligible for financial assistance.

In some cases, law enforcement may request additional proof of financial responsibility. In such instances, drivers must show an identification card from the insurance company, a California Proof of Insurance Certificate, an authorization letter from the DMV indicating self-insurance, or paperwork showing that the motor vehicle belongs to a public entity.

California requires insurance companies to report all personal vehicle insurance information to the California Department of Motor Vehicles. Insurance companies do not have to report information related to business or commercial insurance policies. In addition, court personnel and law enforcement officers can access the insurance status listed on DMV records at any time. Using these privileges, the state can ensure that all drivers are carrying the proper amount of insurance on their vehicles at all times. If an individual does not meet the minimum insurance requirements, his or her registration may be suspended.

For example, if a driver cancels his or her insurance policy for a vehicle, he or she has 45 days to submit a new one to the DMV. If a new policy is not submitted, the vehicle’s registration will be suspended. After an initial registration, drivers have 30 days to submit insurance information to the DMV. Otherwise, the vehicle’s registration is subject to suspension. Registrations will also be canceled if the DMV discovers that registration was obtained using false insurance information.

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