California Governor Gavin Newsom recently signed into law the Protect California Drivers Act, a bill aimed at increasing liability insurance minimums. It raises the current mandatory minimums to accommodate the increase in prices since those levels were originally set in 1967. 

Scheduled to take effect in 2025, the bill will also raise minimum amounts ten years later. If you are like many California drivers, you may not give your insurance coverage a second thought until you are in an accident. It’s worth examining the question, “what is the minimum auto insurance coverage in California?”

Current Limits Barely Cover a Fender Bender

First legislated over 55 years ago, the minimum liability insurance coverage was intended to cover the costs of a two-week stay in the hospital or the cost of replacing your car. The current baseline amounts are governed by Cal. Veh. Code § 16056, and the law dictates that all motorists carry coverage of at least:

  • $15,000 for bodily injury or death for one victim
  • $30,000 for bodily injury or death for two or more people per accident
  • $5,000 in property damage to the other driver(s)’ vehicle

With consumer costs for healthcare skyrocketing around the nation and especially in the Golden State, $15,000 might barely cover the emergency transport to the hospital, let alone any medical treatment. Repairs to most newer vehicles are costly, and $5000 would scarcely get a ding fixed and your fender repainted. 

The new limits in 2025 will double the current limits for bodily injury and death, raising them to $30,000 for one person and $60,000 for two or more individuals per accident. Limits for property damage caused to someone else’s vehicle will be tripled to $15,000 as a minimum. Every driver in California will be required to carry these amounts to cover injury and damage if they cause an accident. 

The minimums will increase again in 2035, ten years after the first rise. They will change to  $50,000 for bodily injury or death for one person, $100,000 for two or more people, and $25,000 for property damage. The goal is to prevent decades of inadequate coverage as costs rise, as we’ve seen in the last 50+ years.

Does the Increase in Coverage Requirements Mean I Will Pay More?

Consumer advocates realized that thousands of citizens were facing significant bills they couldn’t afford to pay because the liability minimums were insufficient. This is why they pushed for the creation of this act. However,  because the law is so new, it’s unclear how the change in coverage minimums will affect insurance premiums for California residents. 

Premiums will probably go up because insurance companies are in the business of making money. If they are subject to higher payouts, they are going to pass that cost on to their policyholders. Opponents of the law worry that lower-income drivers will skip having coverage if it means they must choose between buying life essentials, such as groceries, and paying higher premiums.

If you’re concerned about the potential increase in what you pay, you can research low-cost policies available through the California Automobile Assigned Risk Plan (CAARP). This is especially beneficial if you are considered a low-income driver. The plan connects motorists with insurance providers who will cover them and share the higher risk across the policies of other individuals. 

Uninsured Motorists Are Already a Big Problem

Thousands of people in the state already drive without insurance for a variety of reasons. Rising premiums are likely to increase that number, and the knowledge that they will face fines and license suspension doesn’t pay for your damages if they hit you. You can file a personal injury lawsuit but if they are unable to afford insurance, they probably cannot compensate you for your bills.

A strong option for avoiding these situations is to carry optional Uninsured/Underinsured Motorist (UM/UIM) coverage. This insurance allows you to file a claim with your provider if you are hit by someone who doesn’t have any coverage or doesn’t have enough to pay for the full amount of your losses. It keeps you from facing overwhelming debt if you are seriously hurt, or your car is severely damaged. 

Another choice to protect you against someone without adequate coverage is to choose a policy that provides comprehensive and collision coverage. Your liability insurance pays for damage to other people’s vehicles when you are at fault, but it doesn’t cover repairs to your car. That’s where collision insurance comes in. Comprehensive coverage goes further and protects your car from theft, fire, vandalism, or storm damage. 

Why Increase the Minimum Auto Insurance Coverage Requirements in California?

California leads the country in many progressive policies designed to improve life for its residents. However, we have been lagging behind many other states in the area of insurance protection. Arizona, Texas, and New York all recently raised their minimums to similar levels outlined in the Protect California Drivers Act.

Requiring insurance coverage and increasing the minimums work to help all drivers on the road, as well as pedestrians, motorcyclists, and bicyclists. Because car accidents can happen at any time, knowing that the state mandates other drivers to have a minimum ability to pay your bills gives you some peace of mind that you won’t be stuck with overwhelming debt. 

Because California is an at-fault state, anyone who causes an accident is required to pay for medical bills or property damage to the drivers they affect. Having higher minimums may increase your premiums, but it also means there is a larger buffer between your pocket and the bills that need to be paid. Victims can rely on insurance to cover their needs, and you will end up owing less if their costs are very high.

Insurance Can Be Confusing – Get Help Understanding It From Experts

You may not think that asking an attorney is the way to get answers about insurance. Keep in mind that insurance representatives are trying to sell you the most coverage they can to increase their company’s bottom line. Discussing insurance options with a qualified car accident attorney may give you a more realistic idea of whether you should carry higher liability coverage. They can also advise you on whether UM/UIM, collision, and comprehensive are right for your needs.

Car accident attorneys see the good, the bad, and the ugly of crashes and insurance claims all the time. We understand how to negotiate with insurance companies no matter which side of the accident you’re on. We can work to reduce what you may owe someone else, and we can fight to ensure you get every penny you deserve when you are hurt by another person’s negligence.