Whether you’re new to the world of car insurance, shopping around because of a new car, or a seasoned pro at the ins and outs of premiums, it never hurts to review the basic California car insurance requirements.

In this article, we will explore the top four insurance requirements that California law requires and additional insurance policies that are highly recommended.

Once you understand what you need in order to attain and maintain auto insurance, OnlineAutoInsurance.com can help you find the cheapest rate for your needs.

Is Auto Insurance Required in California?

Short answer: yes, auto insurance is required in California.

In fact, it is illegal to drive without insurance. You may be asked to provide evidence of insurance when you are renewing your car’s registration, when you are involved in an accident, or at the request of law enforcement. If you are not able to show proof, you will get a ticket. Your vehicle may also be impounded, and your license could be suspended.

Acceptable types of insurance can include:

  • A motor vehicle liability insurance policy

  • A cash deposit of $35,000 with DMV

  • A DMV-issued self-insurance certificate

  • A $35,000 surety bond from a company licensed to do business in California

But having only one of these options may not cover your overall expenses. If you cause an accident that costs more than your limit, deposit, or bond, you might be responsible for an enormous bill.

It’s wise to distance yourself from this risk by purchasing higher liability limits than the law requires.

Top 4 California Car Insurance Requirements and What They Cover

California insurance policies operate on a “fault” system, meaning that in the state of California, drivers are responsible for the costs incurred by getting into an accident.

How much is car insurance in California? The average car insurance California tops out at around $1,974 per year, probably because the California DMV’s minimum liability requirements for insurance are:

  • $15,000 for injury/death to one person

  • $30,000 for injury/death to more than one person

  • $5,000 for damage to property

Liability insurance compensates a person other than the policyholder for personal injury or property damage. California car insurance requirements state that drivers must equip themselves with insurance that, at the very least, covers all the DMV’s bases. These costs break down into four basic types of coverage:

#1 Property Damage Liability Coverage

This type of insurance covers property damages when you are at fault for an accident. It is one of the two required liability coverage policies (the second being Bodily Injury Liability Coverage, which we will cover in #2).

Sometimes when you get into an accident, more than just a vehicle is harmed. Did you accidentally damage one of your neighbor’s trees? Dent a mailbox? Hit drive when you meant to reverse in a driveway? Property damage liability covers repairs for all these situations and more.

Some additional examples of property damage insurance coverage include:

  • Houses

  • Vehicles

  • Offices

  • Stores

  • Trees

  • Lamp posts

Coverage Limits

It’s important to note that $5,000 is the state’s minimum requirement. That means it may not cover all your property damage liability needs. \ \ To calculate how much coverage you need, start with your personal assets. The total value of your personal assets can determine the minimum amount of coverage you need to protect your finances in the case of a car accident at which you are at fault. You can add to that protection by choosing other types of liability to add to your car insurance policy, even beyond the requirements we will discuss below.

Minimum Cost


#2 Bodily Injury Liability Coverage

This kind of liability coverage protects you if you cause an accident that injures another driver or a pedestrian. Your insurance is obligated to defend you, in court and otherwise, and pays claims to the other driver or pedestrian.

These claims can include:

  • Medical costs

  • Hospital costs

  • Nursing care

  • Rehabilitation

  • Lost income

  • Reimbursements for pain and suffering.

It’s important to note this kind of coverage does not protect your car or injuries to you in this situation; another policy below takes care of that.

Coverage Limits

There are two basic coverage limits to Bodily Injury Liability Coverage: per-person and per-accident. The coverage amount is a “split limit,” which describes the maximum coverage limits for one injured person vs. two or more persons in one occurrence (ex. $100,000/$300,000). \ \ Be aware: you will probably need to add to your coverage amount to ensure you are fully protected if the person injured has medical bills that go over state minimums. But raising your limits doesn’t have to be expensive: $300,000 in coverage only costs 20% more than $100,000, on average, less when you use OnlineAutoInsurance.com to find the best rates.

Minimum Cost

\$15,000 per person / $30,000 per accident

#3 Uninsured Motorist Property Damage Coverage

As the name suggests, Uninsured Motorist Property Damage Coverage protects against damages to your property (your home, car, or other assets) when the driver at fault is uninsured or does not have the means to repay you for the damages caused.

According to a study by the Insurance Research Council (IRC), 13.0 percent of motorists in 2015, or 1 in 8 drivers, were uninsured. 1 in 4 didn’t even have enough coverage. It’s a good idea to plan ahead and purchase this coverage in case you encounter one of these 1 in 4—whether the state requires this kind of insurance or not.

Coverage Limits

Depending on the policy, uninsured motorist property damage coverage may or may not cover hit-and-run situations where the at-fault driver is never identified. In addition, there are limits to the amount of coverage per policy, depending on deductibles.

Minimum Cost


#4 Uninsured Motorist Bodily Injury Coverage

This policy is your safety net in the case that someone hits and injures you and/or your passengers.

There is nothing more important than your health, and uninsured motorist bodily injury coverage will give you the peace of mind that if anything happens, your insurance will cover you—whether or not the other driver has insurance to pay for your expenses. This type of insurance helps pay for medical treatments as well as pain and suffering. This kind of policy may even reimburse you for lost wages in the event that an accident causes a leave of absence from work.

Coverage Limits

Policies can vary when covering bodily injury against an uninsured motorist. A good rule of thumb is to calculate the amount of bodily injury liability insurance you need and purchase the same amount in uninsured motorist bodily injury coverage. This should cover you and your passengers.

Minimum Cost

\$15,000 per person / $30,000 per accident

Combining the Top 4 Requirements

When combined, these four insurance requirements protect you no matter who is at fault in an accident or how much damage is caused.

Whether you are at fault for a friendly fender bender or end up in a more serious accident with medical and property damage repercussions, you will want to be insured.

Make sure to at least have these California minimum car insurance coverage requirements. Don’t be part of the 1 in 4 insufficiently covered drivers in the US. Drive safely, drive covered.

Types of Insurance Not Required, But Recommended

We covered the top four required car insurance policies in California. But there are many necessary and affordable premiums that are worth investing in to guard your car and your future. \ \ Below are a few recommended types of insurance that you should include in your budget. These policies either supplement the required policies or provide you with coverage in other areas.

  • Personal Injury Protections Insurance – If you get into a car accident, PIP insurance covers you and any passengers involved, regardless of who is at fault for the collision. It even covers you as a pedestrian. So if you are hit by a car when outside your vehicle, you’re covered.

  • Medical Payments Coverage – This useful policy covers medical payments in all states, no matter who is at fault. This policy is especially excellent for cross-state travelers. Examples of coverage include doctor’s visits, ambulance fees, dental procedures, rehabilitation, and more.

  • Car Repair Insurance – Don’t want to risk costly out of pocket car repairs? Car repair insurance may be worth your investment. Though it doesn’t cover anything that falls into the “normal maintenance” category, this policy is worth it when something goes unexpectedly awry with your engine, brakes, or transmission.

  • Roadside Assistance and Towing Insurance – To avoid unnecessary stress when you get stranded after a mechanical snafu, invest in roadside assistance insurance. This policy helps put a plan in place for a roadside rescue before a breakdown happens. It can also help you avoid any extra towing or mechanic payments that come if you are caught unprepared.

Finding the Best Insurance for You

When you’re getting behind the wheel, make sure you’re covered under the law with the four basic insurance requirements in CA. You don’t want to get caught texting and driving in California and incur not only a hefty texting and driving California fine but be subject to your car and driver’s license being taken away.

But when shopping for insurance, it’s a good idea to go beyond the basics. How do you get started? OnlineAutoInsurance.com. We help find who has the cheapest car insurance in California and the coverage that is right for you. \ \ OnlineAutoInsurance.com is fast, free, and personal. We’ll find the discounts you’re qualified for and help you drive safely while enjoying the cheapest insurance rates on the internet.


The Hartford. What Is Property Damage Liability Insurance? https://www.thehartford.com/aarp/car-insurance/property-damage-liability-insurance

California DMV. Insurance Requirements. https://www.dmv.ca.gov/portal/vehicle-registration/insurance-requirements/

California Department of Insurance. Automobile Insurance Information Guide. http://www.insurance.ca.gov/01-consumers/105-type/95-guides/01-auto/auto101.cfm#introductiontoautoinsurance

Nolo. California Car Insurance Requirements. \ https://www.nolo.com/legal-encyclopedia/california-car-insurance-requirements.html