California requires drivers to carry AT LEAST the following auto insurance coverages:
- Bodily injury liability coverage: $15,000 per person / $30,000 per accident minimum
- Property damage liability coverage: $5,000 minimum
- Uninsured motorist bodily injury coverage: $15,000 per person / $30,000 per accident minimum
- Uninsured motorist property damage coverage: $3,500 minimum
Now the question is what exactly each coverage covers.
1. Liability Insurance:
Liability insurance has two-part coverage: (a) bodily injury liability and (b) property damage liability.
If you cause an accident, bodily injury liability covers expenses related to other parties’ physical injuries caused by your vehicle. Property damage liability covers for repairs to the victim’s damaged property, including a car or a house. It will not protect you or your passengers if you are injured or your vehicle is damaged because of the accident. If you can afford it, however, it is usually a good idea to have liability insurance that is above California minimum liability coverage requirement to provide extra protection in the event you are found at fault for an accident.
2. Collision Coverage:
Unlike liability insurance, collision coverage will pay for the repairs to your car. If your car is older, it may not be worth carrying collision coverage on it, depending on the value. On the other hand, if you have a more expensive car or one that is relatively new, collision insurance can help get you back to where you were before any damage to your car. If you have a lienholder, such as your car is leased, this coverage is required.
3. Comprehensive Coverage
Comprehensive coverage covers damages not related to a covered accident, such as: weather damage, hitting an animal, or vehicles thefts. Comprehensive coverage is one of those things that is great to have if it fits in your budget. If you have a lienholder, this coverage is required.
4. Medical payments:
If you are involved in an accident, Med Pay may cover your expenses for medical, surgical, dental, ambulance transportation, hospitalization, X-rays, nursing care, prosthetics, and funeral expenses. If you already have health insurance or HMO coverage, you may not need to add Med Pay coverage to your insurance. Med Pay is not a substitute for regular health insurance; it covers you only in the event of an accident.
5. Uninsured /Underinsured Motorist Protection
When someone hits your car and he has no insurance or his insurance does not cover your damages, then you should either pay your costs out of your pocket or enter a lawsuit if the opponent party is wealthy enough to pay your costs. This is the type of situation where Uninsured and Underinsured Motorist Protection would help with expenses. It is usually relatively inexpensive to add uninsured/underinsured motorist protection to your car insurance policy, especially considering the amount of protection it offers.
To conclude, the insurance policy should be read carefully to be assured that it covers possible damages to you.