California Auto Insurance Laws
Auto Insurance Laws and Trends in CA
One of the largest and most populous of the states, California also has one of the highest auto insurance premium rates in the country. California works on the tort system of insurance, meaning that the party found to be at -fault must pay for damages and injuries sustained in an automobile accident.
There are four ways to prove financial responsibility in California. Motorists must provide the DMV with a $35,000 cash deposit or a certificate of self insurance. Drivers can also obtain a surety bond of $35,000 from their insurance company or purchase a liability insurance policy. For obvious reasons, most people choose to purchase an auto insurance policy.
California auto insurance premiums
Insurance premiums ca n be astronomical if left unchecked. Therefore, the California government has passed a bill that protects consumers from price inflation. All insurance companies are required to offer the lowest possible quote to all drivers through a toll free phone number, an online website, or by offering service in a location that the consumer can consult an agent in person.
California law also mandates that all drivers risk having their license and registration suspended if their insurance lapses or is cancelled. This is to prevent motorists from purchasing auto insurance for only a few months. It also helps to reduce the number of uninsured and underinsured motorists on the road. Insurance companies in California are required by law to report all information regarding private passenger information to the DMV. However, they are not required to report information regarding commercial or business auto insurance.
California auto insurance and SR-22 forms
If a motorist has been convicted of driving without insurance, causing a motor vehicle accident, been convicted of a DUI, reckless driving, or dangerous driving, he or she will have to apply for a SR-22. This will allow the driver to be able to obtain insurance once again. In order to have their driver's license and insurance re-instated, motorists must pay a fee of $125.00, show proof that they have obtained a SR-22, and show proof that they have enrolled in an approved DUI program.