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Car Accidents Involving Uninsured & Underinsured Drivers in California

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Jeff Sevey

If you drive a car in California, you must carry your own auto insurance policy. It’s not optional. But there are two additional insurance policy coverages that you may be interested in investing in. These policy additions will cover your losses should you be in a car accident with another driver who does not carry insurance, or does not carry sufficient insurance. These are called Uninsured Motorist Coverage and Underinsured Motorist Coverage.

In this article, we’ll discuss basic California car insurance laws and how they work in the case of a claim or lawsuit. We’ll see what kinds of insurance coverages are mandatory under California law, and discuss optional coverages in depth.

California as a “Fault” Insurance State

When it comes to car insurance, and the types of remedies that are available after a car accident occurs, California follows a “fault” system. What this means is that, if you’ve been injured in a car accident - as a driver, passenger, or pedestrian - and you were not at fault for causing the accident, you have very few restrictions on how you can pursue compensation for damages. Your losses may include things like medical bills, property damage, lost income, and lost future income, but that certainly isn’t an exhaustive list. The actions you may take to obtain compensation for your losses include:

  • Filing a claim with your insurance company under your own policy
  • Filing a claim with the at-fault driver’s insurance company
  • Filing a personal injury lawsuit against the at-fault driver

California Minimum Insurance Requirements

The insurance that is required by law in California is liability coverage, and there are certain minimum coverages in place to help protect drivers of other vehicles, should you cause an accident resulting in damages or personal injury. Anyone operating a vehicle in the state of California must have liability coverage meeting or exceeding these minimums:

  • $15,000 for injury or death to one person (this could be another driver, a passenger, or a pedestrian)
  • $30,000 for injury or death to more than one person
  • $5,000 for damage to property

As you can see, these minimums would not cover a serious car accident that involved extensive injuries, property damage, or death. In most cases, you will want to carry more coverage than these minimums because if you are found at fault in the case of an accident, the insurance will only cover up to those dollar amount limits. If those limits are exhausted, you will be personally responsible for paying the remainder of the damages out of your own pocket. This can be financially devastating to you and your family.

California’s “Financial Responsibility” Requirement

In order to meet the minimum California insurance requirements, most automobile owners purchase insurance that not only reaches those minimums but also exceeds them. It simply pays to invest in as much insurance as you can afford to give yourself the protection you need when you need it. Fortunately, the state of California does give people other options when it comes to complying with laws regarding financial responsibility. In lieu of a qualifying insurance policy, drivers in California can do any of the following:

  • Give the California Department of Motor Vehicles a cash deposit of $35,000.00
  • Obtain a self-insurance certificate from the California DMV
  • Obtain a $35,000.00 surety bond from an issuer licensed in the state of California

That is a basic synopsis of the laws regarding automobile insurance in the state of California. Now, let’s get into Uninsured and Underinsured Motorist Coverages.

First of all, let’s be clear that uninsured/underinsured insurance coverages aren’t required in California. Having said that, it pays to invest in this coverage for various reasons.

Why You Need Uninsured Motorist Auto Insurance Coverage

When you’re the victim of an auto accident and there’s another driver at fault, typically their liability coverage would be what pays for the damages - personal injury and/or property damage. On the other hand, if the other driver doesn’t have any auto insurance at all, you’d be left paying out of your own pocket for all your medical bills and any property damage to your car.

When you’ve invested in uninsured motorist coverage, though, it will help in compensating you for your own costs, at least up to whatever your coverage limits are. (And this is why it pays to buy more than the minimums.)

Why You Need Underinsured Motorist Auto Insurance Coverage

Underinsured coverage is just what it that will help cover your losses should you be involved in an accident where the at-fault driver doesn’t have enough insurance coverage. Underinsured coverage is related to uninsured coverage, but they are two separate coverages covering two different situations. With some insurance companies, though, the coverages are bundled together and referred to as one single protection.

Underinsured generally refers to situations where:

  • The at-fault driver has liability coverage limits that are lower than the amount of your damages; or
  • The at-fault driver has liability coverage limits that are less than (or possibly equal to) your own underinsured motorist coverage limits.

Uninsured/underinsured motorist insurance offers you protection in two distinct ways:

  • Bodily injury coverage will protect you from any costs incurred related to injuries sustained in a crash caused by an uninsured or underinsured at-fault driver. (It may also extend to a family member driving your car and passengers.)
  • Property damage coverage will cover repairs to your vehicle itself, or replacement of the vehicle should the car be totaled, or damage that occurred to anything inside your vehicle due to the crash.

Hopefully, you can see what a benefit having uninsured/underinsured motorist coverage can be. It may be the only coverage you have to fall back on in the case of a serious accident where you’re not at fault, but the other driver simply doesn’t carry the insurance coverage you need to get just compensation for your damages.

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