As with most states, California state auto insurance law requires all drivers to carry 3 fundamental liability components.
Bodily Injury Liability (BIL) of $ 15,000 per person injured
Total Bodily Injury Liability (Total BIL) of $ 30,000 for each accident
Property Damage Liability or PDL of $ 15,000 / accident
The insurance business knows this as 15k/30k/15k.
To limit your coverage to these minimums, would be looking for trouble. Multi-car collisions & legal fees commonly boost the cost of an automobile accident into the hundreds of thousands of dollars. If you’re at fault and you’ve gone with the minimums, you personally, are now on the hook for the shortfall. So, you must sell your house, empty your bank account and probably alot more…how does that sound?
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) pays for injury to you and your passengers no matter who was at fault. 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 are liable for a predetermined “deductible” amount and the insurer pays the balance.
Comprehensive protects your auto for theft and vandalism and damages caused by Mother Nature, animal impact and fire.
Another vital coverage is protection against uninsured drivers. You are not at fault, but he can’t or won’t pay. Your uninsured motorist coverage steps in.
Auto insurance in Southern California may offer “Pay-per-mile”.
CA’s Insurance Commissioners have tabled a plan allowing insurance companies to charge 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 advocate groups are backing the plan because paying for miles traveled, instead of an insurer’s estimate, will provide savings for low mileage drivers.
And more importantly to some, the program will provide an incentive for motorists to stay away from the road. Environmentalists say this type of auto insurance La Mesa will encourage consumers to drive less…leading to lower fuel consumption, reduced pollution and less congestion on the road.
The plan looks good to me.
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