Wilcoxen Callaham, LLP believes it is important for anyone who drives in California to understand the laws that affect them. An important change is coming to California motor vehicle liability insurance coverage, which is what many of us refer to as “car insurance.” Senate Bill 1107, which affects car insurance minimums, goes into effect on January 1, 2025, and will affect all drivers. This law that passed in 2022 will require an increase in the minimum limits of motor vehicle liability insurance coverage for any private passenger autos, commercial business or recreational vehicles.

How will this impact my insurance policy?

The new law increases the minimum limits for coverages related to the liability portion of your auto insurance policy. This includes uninsured motor vehicle coverage. The new minimum liability limits will increase to 30,000/60,000/15,000 beginning January 1, 2025. All existing policies with lower limits will renew at the new minimum limits on or after January 1, 2025, as mandated by this new state law. Getting in the car could cost you more. If your coverages are increased to comply with the new minimum requirements, there could be an impact on your premium.

What do the three numbers mean?

The numbers 30/60/15 represent the monetary limits of your liability coverage shown on your declarations page:

  • The first number, 30 or $30,000, is the maximum coverage for bodily injury liability for one person injured in one accident.
  • The second number, 60 or $60,000 is the maximum coverage for bodily injury liability for all persons injured in one accident.
  • The third number, 15 or $15,000 is the maximum coverage for property damage liability in one accident.

What is liability insurance?

Car liability insurance is a type of auto insurance that helps cover the costs if you are responsible for an accident that causes injuries to other people or damage to their property. It is broken into two kinds:

  • Bodily Injury Liability: This covers the medical expenses, lost wages, and legal fees associated with injuries you cause to another person in an accident. It may also cover pain and suffering or funeral costs if the accident results in death.
  • Property Damage Liability: This covers the cost of repairing or replacing another person’s property that was damaged in an accident. This typically refers to damage to other vehicles but can also include damage to buildings, fences, or other structures.

Liability insurance does not cover your expenses or your own injuries. This type of insurance is called either collision or comprehensive. Collision insurance protects your vehicle from damage caused by a collision whether that’s with another vehicle, a wall or anything else you crash into. Comprehensive

coverage protects against other things out of your control, such as weather, theft, vandalism and damage from animals.

What is Uninsured or Underinsured Motorist Coverage (UIM?)

UIM protects you against at-fault drivers who are unable to pay for the damage they cause. This could be because they are illegally driving without liability insurance or because even with the minimum coverage, the damages exceed the amount their policy covers. In these cases, UIM steps in to cover the costs. It is very important that you have UIM. If you get into an accident and the other party is not insured, this may be the only way to get financial help for your medical expenses and other injuries. Wilcoxen Callaham, LLP advises all of their clients to have this very important coverage.

Why is this happening now?

Implementing changes required by a new law can take months. While the law is going into effect now, the process to implement these changes was set in motion in 2022 after the law was passed.

What is the reason for this change?

The current limits have not been adjusted for more than 56 years. The change provides more protection for California drivers since services associated with these coverages, like medical and repair costs, have risen significantly in that time.

How will this work? Do I need to do anything?

No action is required. All existing policies with lower limits will renew at the new minimum limits on or after January 1, 2025, as mandated. However, it may be a good time to reach out to your State Farm agent to review all your coverages and review potential discounts.

When will this happen?

The new law goes into effect January 1, 2025. Customers who are impacted will see the change in their next policy renewal after that time.

Anything else?

Yes, remember that you still always need to have a printed proof of insurance coverage in your vehicle at all times. Today is good day to check your glove box and make sure you have the most updated insurance ID card in your vehicle!

Where can I read the text of this new law?

To read about this law, you can go to https://leginfo.legislature.ca.gov/faces/billNavClient.xhtml?bill_id=202120220SB1107.

If you have been in a vehicle accident and you were not at fault, please call Wilcoxen Callaham, LLP to discuss your case and get a free evaluation. You never pay unless we win. Call us today at 916-442-2777 or fill out our convenient form at https://www.wilcoxenlaw.com/contact-us and we will be there to help. Wilcoxen Callaham, LLP, Experienced Attorneys, Compassionate Representation.