How Much Car Insurance Do I Need?

Every state has minimum requirements for car insurance. California is no exception. If you are in a major crash, the minimum insurance requirements are never nearly enough to pay for your medical bills and repair expenses. 

The car accident attorneys at The Cartwright Law Firm, Inc. know that a car accident can have a major impact on your life. We are sharing advice on how much car insurance to carry to make sure you are protected. 

California Liability Insurance Requirements

California requires that you have the following minimum liability coverage:

• $15,000 for bodily injury or death per person;
• $30,000 for total bodily injury or death per accident; and
• $5,000 for damage to property.

$30,000 is the total bodily injury coverage for the entire accident. If two people are injured, they will need to share the $30,000 insurance payout.

$5,000 for property damage covers the damage you cause to another person’s car or by hitting any objects or structures in the accident. This could include light fixtures, telephone poles, mailboxes, or trees.

Like most states, California considers driving a privilege, not a right. By buying car insurance, each driver is showing that they can take on “financial responsibility” if they are responsible for an accident.

Compensatory Damages

Anytime someone is in an accident, they can try to recover damages. These are designed to make the injured party “whole” again for their injuries or losses.

There are two types of compensatory damages: special (economic) and general (non-economic) damages.

Special, or economic damages, are those losses that have a monetary value. 

Examples of special damages:

• Lost wages
• Lost earning potential
• Past and future medical bills
• Homemaker services
• Vehicle repairs

On the other hand, general or non-economic damages are those losses that are intangible. Although general damages cannot be given a specific monetary value, they do affect the quality of the car accident victim’s life.

Examples of general damages:

• Pain and suffering
• Loss of society
• Loss of consortium
• Loss of companionship
• Disfigurement

If you are at fault in a car accident, the victim could potentially sue you for any of the above-listed damages. Having more coverage is always the smarter option in order to protect your hard-earned money.

California is an “At-Fault” State

Some states are known as “no-fault” states, meaning that each driver’s insurance would pay out for each respective driver’s injuries and vehicle damage. However, California is an “at-fault” or “tort” state, meaning that the driver who caused the accident must pay from their insurance policy. 

If you are at fault in a serious collision, but you only have the minimum coverage, the other driver can take you to court. Depending on the situation, you could lose your savings and even have a lien put against your home.

If you are in an accident and do not have the required liability coverage, the state is permitted to suspend your license for one year and issue a fine of up to $200. If the other driver was responsible for the accident, you will be barred from recovering for general damages.

Should I Increase the Limits of My Current Coverage?

Unfortunately, the state minimum liability coverage does not adequately cover you if you are in a serious crash, or if you are sued by the other driver.

It may be in your best interest to purchase 100/300/100 coverage. This would breakdown as the following:

• $100,000 for bodily injury or death per person;
• $300,00 for total bodily injury or death per accident; and
• $100,000 for damage to property.

A policy with higher coverage limits will inevitably mean higher premiums. Rates will vary between insurers. It is important that you contact different insurers and get different quotes before settling on a policy.

Additional Types of Coverage

Additional types of coverage are available in California:

Uninsured/Underinsured Motorist Coverage

Uninsured motorist coverage (UMC) will protect you if you are in an accident with another driver who is at fault but does not have insurance coverage. Uninsured motorist bodily injury (UMBI) will cover the costs for your injuries or if your passengers sustained any injuries. The limits will match your current liability coverage limits.

Another valuable type of coverage, uninsured motorist property damage (UMPD), will cover the cost to repair your vehicle, but only up to $3,500. This coverage may not apply if you already have collision coverage, which is described shortly. 

In the same vein, underinsured motorist coverage (UIM) will cover limited costs for any bodily injury. UIM applies if you were in an accident with a driver who was at fault for the accident but did not purchase enough insurance to cover the costs.

California insurance companies are required to offer drivers both UMC and UIM options. If a driver elects not to buy these options, he or she must sign a waiver. Sadly, many drivers do decline these coverage options, not realizing that the additional protection could save them a lot of money if they are in a crash.

Medical Payments Coverage

If a driver buys medical payments coverage, also known as “Med Pay,” the driver and the passengers will have their medical expenses covered. It does not matter which driver caused the accident.

The lowest amount you can purchase is $1,000 per person. You do have the option to purchase higher coverage. 

Medical bills can pile up quickly. Although it is nearly impossible to determine how much Med Pay you may need, many insurers offer up to $25,000 in coverage per person.

Collision & Comprehensive Coverage

While the minimum property damage insurance requirement covers the cost of damage to other’s property, this will cover the damage sustained to your vehicle.

Both collision and comprehensive coverage are physical damage coverage. This additional coverage will pay the cost to repair or replace your own vehicle.

Collision coverage will protect you if your vehicle collides with another car or object, like a deer. Alternatively, comprehensive coverage will give you protection if your car is vandalized, stolen, or destroyed.

These two coverages are usually sold together by insurers. Compensation is based on the market value of your car, so it may not be the best option for those who are driving older vehicles.

A San Francisco Car Accident Attorney Dedicated to You

Car accidents can range from minor to severe. Knowing you have the coverage necessary to protect you if you are in an accident can give you peace of mind. The attorneys at The Cartwright Law Firm, Inc. are here to assist you. If you have been in an accident, contact us today for any advice or to retain representation. We have offices conveniently located in Santa Rosa, Vacaville, and Discovery Bay.