California Auto Insurance – What You Now Need and Savings Coming Up
As with most states, California state car insurance law requires all motorists to carry three fundamental liability components.
Bodily Injury Liability (BIL) of $ 15,000 / person
Total Bodily Injury Liability of $ 30,000 per accident
Property Damage Liability or PDL of $ 15,000 / accident
In insurance industry jargon, this is known as 15/30/15.
But to rely on this coverage alone, would be sheer foolishness. Multiple pile-ups and ambitious lawyers often drive the cost of a vehicular accident to well beyond six figures. If you are at fault and you have gone with the minimums, you personally, must cover the shortfall. As a result, you'll need to sell your home, empty your savings account and possibly more. How does that sound to you?
On the basis of experience, I recommend a minimum of 100k/300k/100k...more if you’re on the road often, particularly in the up-market communities of California. Spending a few extra bucks here is money well spent.
So far, only liability coverage has been discussed...and that does not apply to damages to your vehicle or injuries to you. What we will discuss from here on is not mandated by law in California.
First, let's think about you. Personal Injury Protection (PIP) covers you and your passengers for injury and/or accidental death. I suggest PIP coverage of no less than $ 100,000.
Next, your vehicle. To most people, full coverage means collision and comprehensive.
There are 2 reasons for collision insurance; to cover the cost of repairs to your damaged auto or, if the vehicle is "totaled”, to compensate you in cash. You will pay for a pre-specified deductible amount and your insurer will pay for the balance.
Comprehensive covers your car for theft and vandalism and damages caused by fire, animal impact and acts of God.
Another vital coverage is protection against uninsured drivers. The accident is not your fault, but the guilty party can’t pay. Your uninsured driver coverage kicks in here.
Southern California auto insurance proposes “Pay-Per-Mile”.
California’s Insurance Commission has tabled a proposal allowing insurance companies to charge consumers based on actual miles driven. Similar to purchasing prepaid cellular phone minutes…consumers would pay in advance for a number of miles to be driven during a specified time period. A device installed in the automobile will allow the insurance company to monitor a car's mileage and charge appropriately.
Consumer protection groups are pushing for the proposal because paying for driven miles, as opposed to the insurance company’s projection, should allow cost savings for low mileage motorists.
And possibly more important, it will serve as an incentive for drivers to stay off the road. Environmentalists predict this type of auto insurance in La Mesa and other California cities will encourage consumers to drive less…leading to lower fuel usage, reduced pollution and less congestion on the road.
The plan looks like an all around winner to me.