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With rising costs across the country due to inflation, now might seem like the wrong time to increase insurance minimums. However, a new legislative bill in California seeks to do just that.
The Protect California Drivers Act will raise mandatory minimum liability insurance coverage, doubling what it currently is.
This is not necessarily a bad thing, however. There are both pros and cons to this new legislature. While it will raise insurance premiums, it ultimately means more protection for drivers in the long run if they were to get into a car accident in California.
So, let’s dive in to learn a bit more about this new bill and how it will affect California drivers.
Current California Liability Insurance Laws
Part of the reason for the new bill is that the original legislature concerning California insurance minimums is decades old. Current rates were set back in 1967, which made sense at the time, but now they are outdated.
California is ranked 46th in the nation for having some of the lowest insurance limits. In other words, California liability minimums provide some of the lowest coverage for things like medical expenses and property damage.
As per California Vehicle Code 16056, all drivers are required to carry minimum liability insurance, which is currently as follows:
- $15,000 for bodily injury or death for one person
- $30,000 for bodily injury or death for more than one person
- $5,000 for property damage
Of course, drivers can choose to carry more than the minimum. But they must at least carry the minimum coverage as listed above.
This liability coverage is what would compensate other people who are injured in an accident that is your fault. Essentially, the injured victims would file a claim against you, and your insurance would compensate them to help them pay for medical bills and other damages—but they would only be compensated up to your policy limits.
Liability Insurance Changes Under the New Protect California Drivers Act
The new insurance changes under the Protect California Drivers Act will go into effect on January 1, 2025. At that time, minimum liability coverage will increase to the following:
- $30,000 for bodily injury or death for one person
- $60,000 for bodily injury or death for more than one person
- $15,000 for property damage
These minimums will remain in effect for ten years. Then, on January 1, 2035, the rates will increase once again to:
- $50,000 for bodily injury or death for one person
- $100,000 for bodily injury or death of more than one person
- $25,000 for property damage
The Pros and Cons of the Protect California Drivers Act
While the current rates that were set back in the 1960s are clearly outdated, not everyone is pleased with the new bill.
Supporters of the Protect California Drivers Act believe the pros heavily outweigh the cons. The pros are that an increase in insurance minimums will mean better coverage for injured accident victims.
In 1967, $15,000 might have been plenty to cover medical expenses for someone injured in an accident, but today, it would barely cover the cost of just the ambulance ride. This means the cost of hospitalization, doctor’s visits, surgeries, and treatments would all be left uncovered.
Thus, the pros of raising insurance minimums are that it will provide injured victims with more compensation to help them pay for their medical bills and other damages, like car repairs.
Those who are against the bill, however, fear that Californians will not be able to afford the higher premiums that will come with higher insurance minimums. Lower-income drivers already struggle daily with rising costs, and forcing them to pay more to meet new higher insurance minimums will make matters worse.
The concern is that it will either force more people into debt or make current debts worse and that it could result in more uninsured drivers. California already has thousands of uninsured drivers, and those numbers could go up if people have to choose between buying groceries for themselves or paying higher insurance premiums.
What the New Insurance Minimums Could Mean for Californians Injured in an Accident
In the long run, the new Protect California Drivers Act will benefit accident victims.
When you are injured in an accident, you file a claim against the guilty driver’s insurance. So if that driver has higher insurance minimums, it means you will get more compensation to help you pay for your injuries and other damages.
The current minimums are barely enough to cover the cost of medical care today or the cost of car repairs. So higher minimums mean better coverage.
However, you could possibly encounter a driver who has chosen not to pay for insurance. In this case, you could file a claim through your insurance, so long as you purchased uninsured/underinsured (UM/UIM) coverage.
UM/UIM coverage provides compensation to drivers through their own policy if they happen to be injured by another driver who does not have liability coverage, or if their liability coverage is not enough.
You can also file a claim through your own comprehensive and collision coverage to pay for the cost of car damage as well.
We Handle Your Accident Claim So You Can Focus On Your Life
If you are injured in an accident in California and have concerns about getting the compensation you need from insurance, our legal team of personal injury experts can help.
At Sally Morin Personal Injury Lawyers, we care about the people of California and work hard to ensure our clients get the full settlement they deserve. Call us at 877-380-8852 or contact us online today for a free case evaluation.