There is a program in California geared specifically towards drivers who can’t afford a regular auto insurance policy. These drivers must go through a certain process to be found eligible to participate in this program, so not just anyone who thinks they should deserve it will be given this opportunity. This program, known as the Low Cost Auto Insurance Program, is run by California Legislation through certain car insurance providers. It aims to help drivers who cannot afford the expense of a normal car insurance plan due to low income.
With regular auto insurance, policyholders are required to provide certain information to the insurer, such as where they live, how long they’ve been driving, how many traffic incidents they have been involved in, they type of car they drive, and some other things. This information is collected and a rate is determined from this information by the insurance company. Some drivers only make a certain amount of money, which limits their dwelling options. Most often, low paid drivers end up living in lower income areas with higher crime rates. This is one example where a good driver will end up paying higher insurance, due to no bad driving on their part, because insurers charge higher premiums to someone who lives in a higher crime area.
Legislation feels that those drivers who exercise safety while driving and have a clean record but can’t afford a good car insurance plan should be given a chance. Low Cost Auto Insurance in California is the opportunity low-income drivers can take to get good protection on their vehicle. There are requirements that must be met before they can qualify, but once they do qualify they will have adequate protection. People who try round about ways to get this insurance when they can’t qualify should leave well alone; insurers do like any kind of insurance fraud and give out fierce punishment when they find fraudulent activity going on.
To qualify for this program of Low Cost Insurance, a driver must meet requirements including age, driving status, and yearly income prerequisites. There is a limited coverage amount that applies to the coverage and they cannot have any other policy from another company covering their car as second coverage. These rules are in place to help prevent fraud and limit the number of people who may qualify for the program.
Low Cost Coverage: The Low Cost Insurance program is a 15/30/5 policy. It covers up to $15,000 of bodily injury liability per person and $30,000 per accident. This is the coverage that provides payment to the other driver and their passengers for their injuries. The $30,000 can be applied towards all of their injuries combined, while the $15,000 is the limit that the insurer will cover, just as in a typical or regular insurance plan. Also included are $1,000 for medical payment to be applied towards the policyholder’s injuries and also any injuries their own passengers may incur. This can be used in conjunction with a healthcare program. Finally, there is an option to purchase uninsured motorist bodily injury liability per person of $10,000 and per accident of $20,000. As in a normal policy this applies to the injuries occurred when a driver without vehicular insurance causes the accident which results in injuries.
Providers: There is not just one automobile insurance provider who has the ability to offer this program. State legislation rules which companies will provide this insurance so that not one company insures everyone, and also to help this become more fair. If only one company offered the Low Cost insurance program, there is a good chance they would need to raise rates for other drivers to offset the cost. By having law makers decide who does what in this circumstance, all companies can view having this program as an incentive for more customers.
Eligibility: As mentioned earlier, there are requirements that must be met in order for a driver to be allowed to purchase the low cost program. First, drivers must be at least 19 years of age to qualify. This driver also must have had a valid driver’s license for at least 3 years prior to applying and they must be considered a “good driver” by the classification set by the state. The state’s definition of a good driver is they cannot have more than 1 point on their driving record, and they can only be found at fault for one accident. Both of these together – the 1 point and at fault accident – can only occur once in three years.
Also mentioned earlier was the need for the driver to make a certain amount of money to be able to qualify for low income auto insurance. The standard rulings are again dictated by state government. A household of 4 people can make no more than $55,125 a year to be able to qualify for this insurance program, and an 8 person household must make no more than $92,525 a year. The definition of member of household is a person living in the same place who have a relationship of blog, marriage, or adoption. These income figures are determined using ratios of people to income, and the “income must be 250% or less of the federal poverty level” as stated by the State Department of Insurance of California.
Finally, the vehicle can only be covered by the program and no other policies provided by other insurers. In regular policy coverage, multiple policies can cover the same vehicle for extra coverage and protection. However, this cannot be applied when using the low cost program.
Find Low Rates: If a driver does not qualify for the low cost auto insurance program but still needs to find cheap rates to fit into their budget, they can look here on our site and use our quote comparison tool. We provide quotes from a number of insurers side by side for easy comparison to find the lowest price. All drivers should be given the opportunity to pay a low price for their car insurance policy, not just those who receive low income. Take advantage of our fabulous comparison tool to save money on any policy.
