Automobile insurance plays an important role for any California driver. Certain types of coverage are required by law, so carrying motor vehicle insurance helps a driver avoid a driver’s license suspension. Insurance also helps to protect a driver against personal losses in an accident—both direct losses and those that might result from a lawsuit if he or she were at fault in an accident. Automobile insurance can even provide protection if a neighbor kid throws a rock through the windshield while the car is parked in the driveway, and provide a rental car while the car is in the shop after an accident.
However, each of those protections comes from a different type of insurance, some mandatory and some optional. It can be difficult to understand the terminology associated with insurance, and which types insulate the policyholder against which risks.
While your trusted insurance agent is the best source of information about the coverage available to you, the information below will give you a basic understanding of the types of insurance offered in California, which are required, and what protection they provide.
Liability Insurance in Los Angeles County
Every California driver is required to carry liability insurance. This insurance coverage protects other drivers, passengers, pedestrians, bicyclists, and others in the event that you are at fault in an accident. California law requires coverage of just $15,000 per injured person and $30,000 per accident. You are also required to carry at least $5,000 in property damage insurance, to cover damage to another vehicle, or to other property that is damaged in the accident.
In a serious motor vehicle accident, that amount would likely be insufficient to compensate the victim. If your automobile insurance is insufficient to cover the crash victim’s injuries, you could be personally responsible for the balance. Thus, for many drivers, it makes sense to carry more liability insurance than is legally required.
Property Damage California Attorney
Property damage coverage is not required by law in California, but will typically be required by the lienholder if there is a loan on the vehicle. Requiring coverage protects the lienholder in the event that the vehicle is damaged or destroyed, since the security for the loan would otherwise be compromised.
There are two types of property damage coverage: collision coverage and comprehensive coverage.
Automobile Property Damage in Los Angeles
As the name suggests, collision coverage protects against damage sustained in a collision. The collision may involve one or more other motor vehicles, but may also be a single-car collision with a guardrail, garage door, or other fixed object.
Los Angeles County Comprehensive Coverage
Comprehensive coverage protects against damage to the vehicle that does not occur as the result of a collision. Some examples include vandalism, a falling tree branch damaging the vehicle, or the vehicle catching fire. Comprehensive coverage also provides protection if the vehicle is stolen.
Optional Motor Vehicle Insurance Coverage
The insurance coverages described in this section are for the benefit of the driver/automobile owner, and thus are not legally required.
Med Pay Reimbursement California
Medical payments insurance provides coverage for medical expenses you or your passengers incur in an accident, whether or not you were at fault. Insurance carriers must offer you this coverage.
Medical payments coverage generally provides a streamlined, lower-conflict means of getting some or all of an accident victim’s medical expenses covered. This is especially useful when the driver, family members, or other frequent passengers do not have medical insurance, or have very high deductibles. In that situation, medical payments coverage may make it easier for the injured party to receive medical care in a timely manner.
Uninsured Motorist Property Damage in Los Angeles
It’s been estimated that about 15% of California drivers are operating their vehicles without the required liability insurance. If you are injured by one of these uninsured drivers, your own uninsured motorist coverage can provide for medical expenses and other damages that you might otherwise have to cover out of pocket. Similarly, if a driver’s insurance coverage is inadequate to cover your damages, underinsured motorist coverage can bridge the gap.
This type of insurance isn’t legally required, and you are under no obligation to purchase it. However, your insurance carrier is required to offer it to you, and if you opt not to purchase the coverage, you will be asked to sign a waiver.
Miscellaneous Insurance Coverages in California
In addition to the core types of insurance described above, which ensure that an injured party can receive necessary medical care, repair or replace his damaged vehicle, and compensate for other losses, California drivers have the option of purchasing coverage that provides reimbursement for costs associated with problems on the road and after an accident.
For example, towing and roadside assistance coverage helps to pay for a tow or other assistance that may be required if your car breaks down on the road or another problem arises. In addition to towing, some uses for this type of coverage might include calling a service to jump start your car, or to repair or replace a flat tire on the road.
Similarly, you may purchase rental reimbursement, which will cover the cost of renting a replacement vehicle while your car is being repaired after an accident.
Educate Yourself about California Insurance
Choosing the right combination of automobile insurance coverages for you requires consideration of a wide range of factors, including:
• The value of your assets that would be at risk in the event of a lawsuit for damages not covered by your automobile insurance
• Any outstanding balance/lien on your vehicle
• The age, condition, and value of your vehicle
• The quality and extent of your medical insurance and that of family members who ride with you
Making the right decision for you and your family requires carefully examining the coverage options and your circumstances. It will also likely recover shopping around, as different companies offer different rates for different combinations of coverage. When you get quotes from insurers, make sure that you are making an apples-to-apples comparison by having each quote exactly the same coverage options.
Once you’ve made the decision and purchases insurance, keep in mind that circumstances change. The coverage that was right for you when you initially purchased your policy may not be as your assets grow, your medical insurance coverage changes, you pay off the lien on your vehicle, and other changes occur. Review your insurance coverage at least once a year to ensure that it is still the best fit for your needs.