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Why must I have automobile insurance? |
- All states have financial responsibility laws and almost every state requires auto liability insurance.
- You must have sufficient assets to pay claims if you have an accident.
- Insurance exists to help protect your assets.
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Does California law require auto insurance |
- California financial responsibility law requires a minimum of $15,000 bodily injury per individual, $30,000 bodily injury per accident and $5,000 property damage (15/30/5) in order for you to legally drive a car.
- There are low cost policy limits of 10/20/3 in the Los Angeles and San Francisco areas for low-income drivers in the California Automobile Assigned Risk Plan.
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What is automobile insurance? |
- Automobile insurance is a contract between you and an insurance company.
- You agree to pay a premium and the company agrees to pay for losses as defined in the policy.
- The policy protects you from financial losses when you are involved in an auto accident.
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What is a basic automobile insurance policy? |
- There are six kinds of basic auto insurance; each is priced separately.
- Bodily Injury Liability applies if you injure someone else.
- Property Damage Liability pays if you damage someone else’s property.
- Medical Payments or Personal Injury Protection pays for treatment of injuries to the driver and passengers of your car.
- Collision coverage pays for damages to your car if you collide with another car, object.
- Comprehensive coverage reimburses you for loss due to theft or damages other than collision.
- Uninsured Motorist coverage reimburses you if you are hit by an uninsured vehicle. Underinsured coverage applies when an at-fault driver has insufficient coverage to pay for your total loss.
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What if I rent a car? |
- Enough comprehensive and collision coverage on your own car may be sufficient to cover you in a rental car.
- Check with your own insurance company to be sure that you are covered.
- Check with your credit card company to find out what coverage your credit card provides.
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What if I lease a car? |
- The dealer or bank financing the lease will require you to obtain your own liability collision and comprehensive insurance coverage.
- The dealer or bank financing the lease will require you to name them as the loss payee in the event of damage or loss.
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What do cancellation and non renewal mean? |
- After 60 days, a company may cancel a policy only for your failure to pay a premium, if you committed fraud or misrepresentation on your application, or if your driver’s license has been suspended or revoked.
- Non-renewal is a decision made by either you or the company not to renew the policy when it expires.
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