California Car Insurance Requirements

The purpose of the law is to ensure that vehicles driven on California roads have liability insurance that provides financial responsibility for any damage or injury caused by a traffic accident, regardless of fault, and to remove uninsured vehicles from the highways.

CA auto insurance law requires that drivers and vehicle owners carry the following minimum monetary limits:

    * $15,000 for injury or death of 1 person per accident
    * $30,000 for injury or death of 2 or more persons per accident
    * $5,000 for any property damage per accident

Evidence of financial responsibility must be carried at all times in the vehicle. Most Californians maintain financial responsibility through insurance companies, which provide the policy holder with an identification card to be used as evidence of coverage. The card must state the insurance company's name and address, the period of coverage, and policy number.

Liability insurance compensates a person other than the policy holder for personal injury or property damage (comprehensive or collision insurance does not meet vehicle financial responsibility requirements).

Persons operating a vehicle in this state who are unlicensed or have an invalid California or out-of-state driver license are subject to the same financial responsibility laws as valid California licensed drivers.

Financial responsibility must be obtained and maintained on any vehicle operated or parked on California roadways and must be provided as specified below:

    * When requested by law enforcement
    * When renewing vehicle registration (if requested)
    * When the vehicle is involved in a traffic accident
    * Within 30 days of receiving a registration card for a newly acquired vehicle
    * Within 45 days of the cancellation of a policy for a currently registered vehicle

You must carry evidence of financial responsibility (proof of CA car insurance) in your vehicle at all times.
Types of financial responsibility

    * A motor vehicle liability insurance policy
    * A cash deposit of $35,000 with DMV
    * A DMV issued self-insurance certificate
    * A surety bond for $35,000 from a company licensed to do business in California

If you fail to maintain financial responsibility

    * Your driving privilege may be suspended. If you are involved in an accident and cannot provide evidence of financial responsibility, you may lose your driving privilege for up to one year.

    * Registration of your vehicle will be subject to suspension (effective October 1, 2006). DMV will begin the process to suspend the registration of your vehicle if liability insurance is cancelled and a replacement policy is not submitted within 45 days, or your insurance company has not electronically provided evidence of insurance within 30 days of a registration card being issued on a newly acquired vehicle, or if you provide false evidence of insurance.

    * You may be cited. Failure to provide evidence of financial responsibility when requested by a peace officer may result in a citation with fines that could reach $1,000 or more. (DMV cannot clear or sign citations relating to financial responsibility. Only a court can clear or sign these citations).

    * Your vehicle may be impounded. Failure to provide evidence of financial responsibility may result in your vehicle being impounded, in addition to any fines.

    * You may be personally liable for damages. If you contribute to the cause of an accident and cannot provide evidence of financial responsibility, you may be forced to compensate the other party for any injuries and damages.