Car crashes are quite common in the state of California. The state recorded about 9 motor-vehicle deaths for every 100,000 residents in 2018, as reported by the Insurance Institute for Highway Safety (IIHS), placing California among the top five most dangerous states for motorists in the U.S.
In terms of economic impact, car crashes cost the state of California around $4.5 billion every year in the form of lost workplace productivity, legal costs, insurance costs, environmental costs, medical costs, and vehicle repairs. Moreover, according to data from the Insurance Information Institute (III), the cost of auto insurance in California is around 20% higher than the national average.
Keeping this in mind, here’s everything you need to know about auto insurance in Lancaster, CA.
Lancaster, CA Auto Insurance Law– Pure Comparative Negligence Doctrine
When it comes to car accidents, the state of California follows the legal principle of pure comparative negligence. Under comparative negligence, all parties involved in a car crash will shoulder some responsibility for the accident and pay a portion of the awarded damages, if any.
However, under pure comparative negligence, as followed by California, the plaintiff or the defendant can recover compensation only to the extent they were not responsible for their own injuries. For example, suppose the authorities determine you are responsible for 30% of a car crash. In that case, you can recover 70% of your losses, including property damage losses and medical costs from the other party’s car insurance company.
Thus, California traffic law requires all motorists in the state to carry auto insurance.
California Auto Insurance Requirements
All motorists in California must carry auto liability insurance to cover third-party property damage and bodily injuries. The minimum coverage requirements include:
• $15,000 for bodily injury/death of one person
• $30,000 for bodily injury/death of two or more persons
• $5,000 for third-party property damage
Additional Auto Insurance Coverage
While the minimum insurance requirements highlighted above will ensure you have auto insurance, they may be insufficient to cover all the financial losses resulting from an auto accident, especially if you are the driver at-fault. In such a case, the other party may sue you for additional costs, including medical expenses and property damage costs. Consequently, this may potentially cause you to lose your personal assets and savings. To avoid such a situation, you must purchase supplemental auto insurance coverage.
Some of the other types of auto insurance coverage you should consider purchasing include:
• Collision coverage – It covers damage caused to your car owing to a collision with another vehicle or object.
• Comprehensive coverage – It covers damages caused to your car by factors other than a collision. This would include damages caused by theft, vandalism, fire, natural disasters, falling objects, civil disturbances like riots, and damages caused by animals. Both collision and comprehensive covers provide compensation based on the market value of your car.
• Uninsured motorist coverage – Although California traffic law requires motorists to carry insurance, some motorists fail to comply, meaning they have no auto insurance. For this reason, you must carry uninsured motorist coverage. As the name suggests, this policy would come in handy if you’re ever involved in an auto accident with an uninsured motorist. In such a case, your uninsured motorist policy would cover your medical costs if the motorist at-fault is uninsured or underinsured. Additionally, this policy can cover lost wages.
• Umbrella insurance – This policy fills the insurance gaps left by the aforementioned auto liability insurance policies, therefore offering an extra layer of coverage. For example, you can use umbrella insurance to cover the costs of a lawsuit resulting from a fatal car crash, especially if the damages awarded against you far exceed your liability coverage limit.
Auto Insurance Coverage Costs
The cost of auto insurance in Lancaster, CA, varies from one insurer to another based on several factors. These factors include, among others:
• Premium – Usually paid in installments, the amount of money you pay to purchase coverage is called a premium. It covers the term of your policy, which typically ranges anywhere from 6 to 12 months. This amount varies from one insurer to the next.
• Deductible – Before you receive a payout, your insurer may require you to make an upfront payment. Popularly known as a deductible, this upfront payment will also vary from insurer to insurer.
Lancaster, CA Uninsured Motorist Law
According to the Insurance Research Council (IRC), around 15% of motorists in California have no auto insurance coverage. However, if an insured motorist crashes into you, you can still sue the motorist for damages.
Meanwhile, you can use the other car insurance discussed above, including uninsured motorist coverage and collision insurance coverage, to cover some of the financial losses associated with the accident, including medical costs to you and your passenger, if any, as well as the costs of repairing or replacing your car.
The state of California can punish uninsured motorists with fines and penalties, ranging anywhere between $100 to $500 depending on whether the offense is a first offense or a second one.
Car Insurance Policy Cancellation
Under certain circumstances, your auto insurance company may decide to terminate your auto insurance coverage. Some of the reasons for this include, among others:
• Failure to remit your monthly premiums
• Driver’s license revocation or suspension
• Providing false or misleading information on your auto insurance policy
• Filing of a fraudulent car insurance claim
Vehicles Totaled in California
Your insurance company may declare a vehicle that has been severely damaged in an accident to be totaled. In California, whenever a vehicle is damaged to such an extent that further repairs would no longer be economically feasible, the vehicle in question is considered totaled.
To receive insurance payment on such totaled cars, you ought to buy collision and comprehensive coverage. This way, you can make up for the car’s value if it is totaled or stolen. The net amount received will exclude the deductibles reduced from your insurance check.
Thus, with more than 27 million licensed drivers plying California’s roads, all motorists in the state need to carry some form of auto liability insurance. For additional coverage, you can also carry uninsured motorist coverage in Lancaster, CA, or any of the other auto policies, as discussed above.