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Automotive Insurance
protects you
against financial loss if you have
an accident. It is a contract
between you and the insurance
company. You agree to pay the
premium and the insurance company
agrees to pay your losses as defined
in your policy up to your policy
limits.
Auto insurance
provides property, liability and
medical coverage. Property coverage
pays for damage to or theft of your
car. Liability coverage pays for
your legal responsibility to others
for bodily injury or property
damage. Medical coverage pays for
the cost of treating injuries,
rehabilitation and sometimes lost
wages and funeral expenses. Your
insurance company should notify you
by mail when its time to renew the
policy and to pay your premium.
Required
Coverage
The minimum
liability
insurance
required in
California is:
-
$15,000 for
injury or
death of one
person
-
$30,000 for
injury or
death of
more than
one person
-
$5,000 for
damage to
property
This is the
absolute minimum
coverage that
you can carry.
Your insurance
company may
recommend
coverage in the
range of
100/300/100.
Proof of
Coverage
Proof of
liability
insurance
(Insurance Card)
must be in the
vehicle at all
times. If you're
pulled over and
you do not have
your card you'll
be cited and
fined. The fines
for not carrying
proof of
insurance can be
$500 plus
possible court
costs and your
vehicle could be
impounded.
Car Insurance
Coverage
Purchasing auto insurance is not simply
about the value of your car or how often you
get into accidents, it is also about how
much money you are willing to pay for your
coverage. All auto insurance policies have a
deductible. The deductible is the part of
your policy that you are responsible for
paying. Auto insurance policies don't simply
take care of all necessary expenses. You are
required to pay for some of the damages, but
the amount depends on your policy.
Deductibles vary by state, but are most
often in amounts of $100, $250, $500 or
$1,000.
Deciding how
much you are
willing to pay
and how often
you think you
will need to
make an
insurance claim
will help you
decide what
deductible
amount is right
for you. In
addition, the
premium you pay,
or the price of
your total
coverage
annually, can be
lowered by
choosing a
higher
deductible.
When you are required to report an
accident to Department of Motor Vehicles?
- If you are involved in a
vehicle accident that occurred in California, you must report it to DMV if:
- There was property damage of more than $750.00 or anyone was injured
(no matter how minor) or killed.
- Each driver must make a report
with the DMV within 10 days, whether you caused the accident or not and even if
the accident occurred on private property.
- You must complete both parts of the two-part DMV Traffic Accident Report form
SR 1/SR 1A. If you download the form from the DMV website. You will need 8 = by
14 legal paper and to change your print setting to legal size.
- When you have completed the form, you can mail it to:
Department of Motor Vehicles
Financial Responsibility - Mail Station J237
PO Box 942884
Sacramento, California 94284-0884
- If you do not submit this report,
your driving privilege will be suspended. DMV may ask your insurance company to
verify that you had coverage in effect at the time of the accident. If you did
not have insurance, your driving privilege will be suspended for 1 year.
- To get your license back, after the suspension, you will need to provide proof
of financial responsibility and maintain it on record for 3 years. The accident may count as 1 point on your
driving record.
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CONSUMER RESOURCES
Visit our Insurance Resource Center for
information on Automotive Insurance. |
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This coverage applies to
injuries you or a covered driver causes to someone else due to negligence. Its very important to have enough
liability insurance, because if you are involved in a serious accident, you may
be sued for a large sum of money. Definitely consider buying more than the
state-required minimum to protect assets such as your home and savings.
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This coverage pays for the treatment of injuries to the driver and passengers of
the policyholder's car. At its broadest, PIP can cover medical payments, lost
wages and the cost of replacing services normally performed by someone injured
in an auto accident. It may also cover funeral costs. |
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This coverage
pays for damage you or a covered driver may cause to
someone else's property. Usually, this means damage to someone elses car, but
it also includes damage to lamp posts, telephone poles, fences, buildings or
other structures struck by your vehicle. |
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This coverage pays for damage to your
car resulting from a collision with another car, object or as a result of
flipping over. It also covers damage caused by potholes. Collision coverage is
generally sold with a deductible of $250 to $1,000the higher your deductible,
the lower your premium. Even if you are at fault for the accident, your
collision coverage will reimburse you for the costs of repairing your car, minus
the deductible. If you're not at fault, your insurance company may try to
recover the amount they paid you from the other drivers insurance company. If
they are successful, you'll also be reimbursed for the deductible. |
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This coverage reimburses you for
loss due to theft or damage caused by something other than a collision with
another car or object, such as fire, falling objects, missiles, explosion,
earthquake, windstorm, hail, flood, vandalism, riot, or contact with animals
such as birds or deer. Comprehensive insurance is usually sold with a $100 to
$1000 deductible, though you may want to opt for a higher deductible as a way of
lowering your premium. Comprehensive insurance will also reimburse you if your
windshield is cracked or shattered. Some companies offer glass coverage with or
without a deductible. States do not require that you purchase collision or
comprehensive coverage, but if you have a car loan, your lender may insist you
carry it until your loan is paid off. |
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This coverage will reimburse you, a member of your family, or a designated
driver if one of you is hit by an uninsured or hit-and-run driver. Underinsured
motorist coverage comes into play when an at-fault driver has insufficient
insurance to pay for your total loss. This coverage will also protect you if you
are hit as a pedestrian.
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