Auto Insurance Coverage
What types of Coverages are Available
Property Damage Liability
• $5,000 for any one accident.
There are four ways to accomplish financial responsibility:
1. Coverage by a motor vehicle or automobile liability
insurance policy;
2. A cash deposit of $35,000 with the DMV;
3. A certificate of self-insurance issued by DMV to owners
of fleets of more than 25 vehicles; or
4. A surety bond for $35,000 obtained from an insurance
company licensed to do business.
All drivers and owners must have at least the
statutory limits of minimum liability insurance or an approved
alternative way to pay for injury or property damage they may
cause.* Penalties are very severe for non-compliance with this
section of the vehicle code.
When your car is in an accident for which you are found legally
liable, bodily injury (BI) liability covers your liability to others
for injuries to them. Property damage (PD) liability covers
your liability for damage to someone else’s property.
A policy with BI of $15,000/$30,000 and PD of $5,000
will pay out as follows:
• The maximum limit for one person’s injuries, medical expenses,
etc. is $15,000 under the bodily injury portion;
• If two or more people are injured, the maximum limit
for the accident will be $30,000;
• The maximum limit for damage to other people’s property
(their car, their fence, etc.) is $5,000.
Comprehensive coverage (other than collision), uninsured
motorist, medical payments and collision insurance are not
required by law.
What Other Coverages are Available?
Insurance companies must offer the following coverage with every automobile policy:
• Uninsured / Underinsured Motorist Provides liability insurance when the party at fault does not have the state required minimum liability coverage, or the minimum liability coverage is insufficient to cover the injuries sustained in the accident. Likewise, uninsured motorist property damage covers possible reimbursement for damages your car sustains (BI and PD). Most insurance companies will also offer the following optional coverages:
• Medical Payments Provides for the payment of medical and similar expenses without regard for liability.
• Physical Damage (collision and comprehensive): Neither of these cover mechanical breakdown or normal wear and tear. Collision covers damage to your vehicle caused by collision with another vehicle or with any other object, regardless of fault. Collision insurance covers vehicle upset (overturn), but does not cover bodily injury or property damage liability. Comprehensive coverage covers damage to your car caused by reason other than collision, such as fire, theft, windstorm, flood, vandalism, etc.
• Endorsements/Riders Special equipment (i.e. after-market additions such as premium stereos, tires, and other misc. equipment), towing, and rental reimbursement.
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