Learn how to buy the best California car insurance policy for your particular situation, what the average car insurance rates are for your neighborhood and how California state insurance and traffic laws work.
The average car insurance rate in California is $1,518. Unlike nearly all other states, in California your credit history isn't allowed to be factored into your car insurance rate, and where you live is considered, but not given as much weight as in other states. California insurance companies primarily factor in your age, your driving record and how many miles you drive when deciding how much you pay. But every company uses its own method for assessing risk. That’s why the cost for the same policy can vary significantly among insurance companies – and why you should compare rates. For example, in Los Angeles ZIP code 90029, the highest rate among six carriers ($3,450) is more than twice as much ($2,014 more) as the lowest ($1,436).
Cheap car insurance in California
California car insurance requirements
|State law requires the following coverages:|| |
|Minimum bodily injury liability||$15,000/$30,000|
|Minimum property damage liability||$5,000|
California laws mandate that you carry minimum liability coverage limits of 15/30/5 on your vehicle. While buying just minimum coverage means you are getting the cheapest car insurance in California, you are only covered for damage you do to other drivers’ cars and for others’ injuries. That means your insurer won’t pay for damage to your car or for your injuries if you cause an accident.
Keep in mind that a minor accident could easily exceed minimum liability coverage limits, leaving you responsible to pay for damages not covered by insurance. For example, if you have $30,000 in bodily injury liability insurance and you cause an accident that costs $50,000, you have to pay $20,000 out-of-pocket. If you don’t have the money on hand, your assets may be taken to cover the costs. California also has one of the lowest property damage liability limits in the country at just $5,000. If you hit a car and it costs more than $5,000 to fix it, you’re on the hook for the rest of the bill.
If you want more protection, it will cost more, but as you’ll see in the chart below, additional coverage is typically affordable. Boosting coverage from the state minimum to higher liability limits costs $101 a year or about $9 a month. Hiking your policy to full coverage with a $500 deductible costs, on average, $1,027 more, or $86 a month.
|Coverage limits||Average annual rate|
|Liability Only – state minimum||$491|
|Liability Only - 50/100/50 BI/PD||$592|
|Full Coverage - 100/300/100 BI/PD |
$500 Comp/Collision deductible
*The table shows the average annual rate of nearly every ZIP code in California from up to six major insurance companies. Rates are for a male driver, age 40, with a clean record and good credit for a 2016 Honda Accord. Data was provided for CarInsurance.com by Quadrant Information Services.
Recommended car insurance coverage
When deciding how much car insurance to buy, you need to assess your particular situation. To drive legally, you must buy at least the minimum liability insurance required by your state. If you didn’t borrow money from a lender to buy your car and you don’t have a lot of money or assets to protect, that might be a wise choice. If, however, you don’t own your car outright, you will be required to get comprehensive and collision coverage. Additionally, if you have a home and savings to protect, it’s wise to buy more coverage.
Largest car insurance companies in California
|Rank||Company Name||Direct premiums written||Market share|
|5||Auto Club Enterprises Insurance Group||2,312,230||8.48%|
|7||CSAA Insurance Group||1,950,257||7.15%|
Source: A.M. Best; State/Line (P/C Lines) - P/C, US; Data as of:November 28, 2018
Car insurance for cities in California
Find out what the most expensive and the cheapest car insurance rates are by ZIP code, as well as how they compare statewide.
Los Angeles car insurance
San Francisco car insurance
San Diego car insurance
California car insurance laws
California bans use of gender in pricing auto insurance
California joins five other states that have either banned the use of gender in pricing auto insurance or that require unisex pricing, says CarInsurance.com Consumer Analyst Penny Gusner. Insurers have until July to submit gender-neutral auto rating plans to the state's Insurance Department for review.
Using gender is somewhat controversial as insurance companies maintain it’s a fair practice based on their actuarial research, while consumer advocates argue it is discriminatory. "The California ban comes on the heels of another law that went into effect there this year, which allows residents to choose ‘nonbinary’ rather than ‘male’ or ‘female’ on driver licenses. I wouldn’t be surprised if other states begin to consider prohibiting the use of gender when setting car insurance rates as more people and state legislators are challenging the notion of using just ‘male’ and ‘female’ on identity forms," says Gusner.
Novice female drivers will generally be impacted the most, by paying more, if gender is taken out of the rate calculation. Female drivers from age 16 to 24 pay, on average, around $500 less (15 percent) a year for car insurance compared to their male counterparts, according to CarInsurance.com’s rate analysis. Our rate data show from age 25 to 65 rates for males and females are within five percent of each other, with rates for males a tad cheaper from age 45 to 75. After age 75, females start again to pay less, but only around 7 percent, or $100, annually.
The use of gender in setting auto rates highlights how much state insurance laws can differ. Another example: there are three states (California, Hawaii and Massachusetts) that prevent credit history from being used to set car insurance rates. There are also varying laws and rules on how rates, and rate hikes, are regulated.
Other states that ban use of gender in determining car insurance rates: Hawaii, Massachusetts, Montana, North Carolina and Pennsylvania. In Michigan the use of gender in setting rate is technically prohibited but reports suggest that a loophole in the law allows the practice.
California roads with the most fatal accidents
Here are the highways and roads where the most fatal accidents happened in 2017, according to the most recent data available from the Fatality Analysis Reporting System research compiled by the National Highway Traffic Safety Administration:
|Road||Number of fatal accidents|
Good Driver Discount
Under Prop 103, drivers who meet these conditions must receive rates at least 20 percent lower than a driver who does not meet these criteria at the same car insurance company:
- Has been licensed for at least three consecutive years
- Has no more than one point on his or her driving record
CAARP: California Automobile Assigned Risk Plan for high-risk drivers
In California, if you cannot find a car insurance company that will insure you, you can get liability coverage through the California Automobile Assigned Risk Plan (CAARP). This plan is designed for high-risk drivers who are unsuccessful in obtaining insurance from companies that sell non-standard policies.
The plan works by taking your application and assigning it to an insurance company. All insurance companies licensed in the state must accept CAARP applicants. The number of CAARP assignments is based on insurance company market share. The more policies an insurance company issues, the larger the portion of CAARP assignments it is required to take.
The rates used by the plan are the same no matter what insurance company issues the policy. The plan also offers installment options. After three years with a clean driving record, you can get out of the CAARP program and buy a standard policy.
To buy a CAARP policy, you have to work with an agent who is certified by the state to assist in getting drivers these special policies. Start by calling the number below to be paired up with a “certified producer” in your area who will help find an insurer for you. Afterwards, you and your assigned certified producer will work with the insurance company’s agent to get you an appropriate policy.
To Find a CAARP Certified Producer, call 1-800-622–0954
Insurance for low-income drivers
If you are low-income, you may be eligible for the California Low Cost Auto Insurance program, which permits lower liability limits of:
- Bodily injury liability - $10,000 person / $20,000 per accident
- Property damage liability - $3,000 per accident
The low-cost program (rates range from about $241 to $556 a year; discounts are available for those who have had a clean driving record for three years) is available to drivers who meet the following criteria:
- Have a valid California driver’s license
- Own a vehicle valued at $25,000 or less
- Be at least 19 years old and meet income eligibility guidelines
Income eligibility requirements per household effective February 2016 are:
- 1 person - $29,700.00
- 2 people - $40,050.00
- 3 people - $50,400.00
- 4 people - $60,750.00
- 5 people - $71,100.00
Pure comparative negligence
California is among the 13 states that have a pure comparative fault rule. States with pure comparative negligence laws let all drivers recover some payment for their damages, even if they are mostly to blame. For example, a driver 70 percent at fault in an accident could make a claim for damages against the other driver's liability coverage but expect to receive only 30 percent of the claim amount.
You should file a claim promptly after an accident. Your policy should state what is required of you, which may say a reasonable time period or give a specific time-frame in which to make the claim. For instance, you typically must file a stolen car claim within 30 days of the theft.
California requires an acknowledgment of all claims within 15 days. Under California law, insurance companies are required to accept or deny the claim within 40 days after receiving proof of the claim. If the claim is accepted, payment must be made within 30 days from the date settlement was reached.
You have up to three years to file a property damage lawsuit.
California law requires that you file medical claims within two years of the incident. You have up to two years after the incident to file a personal injury lawsuit.