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Home » Blog » Do You Need Uninsured Motorist Coverage in CA?
Even though there are laws that require motorists to have car insurance, many drivers still go without this coverage. Others have policies with minimum limits that are too low to cover damages in the event of an accident. If you drive in California, you need uninsured motorist coverage to ensure you are protected.
Our experienced car accident attorneys at LA Century Law explains why you need uninsured motorist insurance coverage in CA and how this insurance can protect you financially if a crash occurs.
According to the Insurance Information Institution, as many as 17% of motorists in California are uninsured. With car accidents costing Americans $340 billion in 2019, it’s risky not to have uninsured motorist coverage.
Being the victim of a car accident with an uninsured driver can cause economic hardship in numerous ways. Medical bills resulting from injuries add up; approximately 40% of bankruptcies involve medical debt, and new car prices are at an all-time high so vehicle damage can also take a toll.
Having uninsured motorist coverage in California is a vital tool to protect your finances and your future.
While California does not require uninsured motorist coverage, unless you specifically opt out in writing, a policy must include uninsured motorist coverage. However, the insured and insurance company can agree in writing to exclude it or reduce the amount of coverage.
California Insurance Code § 11580.2(a)(1) states that all auto insurance policies must have uninsured motorist coverage unless both parties agree otherwise. Both parties may opt out, or they may agree to lower limits. Excluding or reducing this coverage must be agreed to in writing by both parties.
Uninsured motorist coverage applies in California when the party at fault for an accident does not have enough insurance to satisfy a claim for damages.
Example 1 – The other driver is at fault for the accident. You have $50,000 in damages. They have $100,000 in liability insurance. Their insurance pays you $50,000 for your damages. Uninsured/underinsured motorist coverage does not apply.
Example 2 – The other driver is at fault for the accident. You have $100,000 in damages. They have $50,000 in liability insurance. Their insurance pays you $50,000. You have $50,000 in damages that remain unpaid. Fortunately, you have $100,000 in uninsured/underinsured coverage. Your insurance policy pays the remaining $50,000 in damages.
Example 3 – The other driver is at fault for the accident. You have $100,000 in damages. They have $50,000 in liability insurance. Their insurance pays you $50,000. You have $50,000 in damages that remain unpaid. Unfortunately, you don’t have uninsured/underinsurance coverage. You will not receive compensation for the remaining $50,000 in damages.
Example 4 – The other driver is at fault for the accident. You have $100,000 in damages. They have $50,000 in liability insurance. Their insurance pays you $50,000.
Example 5 – You are at fault for the accident. Hopefully, you have collision insurance. It will pay damages according to the policy, up to the policy limit.
By California law, the insurance company must offer uninsured motorist coverage in the same amounts offered for bodily injury. However, they are not required to offer more than $30,000 for bodily injury per person, $60,000 for total injury per accident, and $3,500 for property damage.
These are minimum amounts. Insurance companies offer various policy limits and premiums so there are options for higher limits.
Note: California minimum liability auto insurance limits are set to increase in 2025.
You don’t know what your possible car accident damages might be when you purchase insurance so you need as much uninsured motorist coverage as you can afford. It’s important to ensure you have enough to cover physical injuries, lost wages, and car repairs. How much you need depends on your net worth, health insurance, and risk tolerance. It’s common to need at least $100,000 per person and $300,000 per incident. Evaluate all options and your situation to determine the right amount for your auto insurance policy.
Remember that uninsured/underinsured coverage pays the excess that the other party’s insurance doesn’t cover.
For example, if they have a $50,000 limit, their insurance may pay up to the maximum. If your uninsured/underinsured limit is also $50,000, the amount paid by the other insurance is credited towards your compensation, and you won’t receive an additional payment. That’s why it’s important to maintain uninsured motor vehicle insurance in the highest amounts you can afford – to ensure you’re fully compensated for your damages.
Have you been in a car accident? Are you wondering how uninsured motorist coverage might apply to your accident claim? At LA Century Law, we help people receive the compensation they deserve for car accidents. Please contact us to discuss your case with a lawyer.