The Personal Insurance Federation of California (PIFC) sent a letter to California Insurance Commissioner Ricardo Lara urging him to issue a bulletin to clarify that the requirement to auto insurance policies comply with new financial responsibility limits should be applied to insurance policies as they renew, not on the specific date the bill becomes effective.
Some background on this… Senate Bill 1107, effective January 1, 2025, raises the minimum required motor vehicle financial responsibility limits to $30,000/$60,000/$15,000. Current limits are $15,000 for injury/death to one person, $30,000 for injury/death to more than one person, and $5,000 for damage to property.
It’s good to see these limits increased, but it’s unclear how this change will take place. It’s not clear if all policies must immediately increase to these new numbers on January 1, 2025, or if policies can renew into the new limits over a 6-month or one-year period. We’ll keep our customers posted about these changes once we know more.
If someone wrecks into you and they’re just carrying the California minimum limits listed above, you’ll only get up to $30,000, which doesn’t go very far if you have major medical issues.
When it comes to these liability limits, we always recommend our customers have a higher limit for Liability, Uninsured and Underinsured motorist coverage on their own auto policy. I personally carry over $1,000,000 million in coverage — for my personal auto policy and my personal umbrella policy — which would cover me and/or my family if a bad accident happened and the other driver just had the minimum required motor vehicle responsibility limit.
If you have questions about auto insurance, reach out to us anytime.