Motor vehicle liability insurance is one of those important but annoying facts of life. It is an expense you have to pay in order to legally drive on public roads that you may never need to use. However, it also offers important protection in the event that you do experience a crash.
Many people view their insurance premium as a burden, which motivates them to minimize it by any means necessary. Typically, that minimization involves reducing excess coverage and potentially dropping liability limits to the state minimum for California. Unfortunately, doing that could create a financial risk that you may not understand until it is too late.
State minimum coverage may not be enough
California sets a base standard for all motor vehicle insurance policies. Individuals need to have $5,000 worth of property coverage, which will pay for damage to vehicles or other personal property in an accident you cause or contribute to.
The law also requires that you have coverage for medical expenses in case someone is hurt or killed. Those base coverage amounts are $15,000 for accidents with one party hurt or killed and $30,000 for crashes involving two or more injuries or fatalities. It doesn't take much imagination to see how medical costs could easily exceed those amounts, as could the cost to repair or replace even a very modest personal vehicle.
If the driver who causes your crash only has minimum insurance coverage, there could be a gap between what the accident costs you and what insurance actually pays. If you cause a crash with minimum coverage, you could wind up facing a lawsuit over the remainder of the financial costs.
Some people don't even have insurance coverage
As if the thousands of people driving around with minimum insurance policies weren't frightening enough, there are also many others who don't have insurance at all. In some cases, these individuals can't afford to continue paying their policies. Other times, their coverage lapse is more due to an oversight.
Regardless of the cause, if the driver responsible for your crash doesn't have insurance, your insurance company won't necessarily cover your costs. You need to have a rider on your policy that protects you in the event that the other driver does not have insurance or doesn't have enough insurance to cover all of your costs.
These riders only cost a fraction of the total policy cost that you invest for each term. However, the practical protection that they offer is invaluable. If you are not sure about whether you have the right riders in your insurance coverage, it may be time to review your policy.
In the event that you've already wound up hurt because of an uninsured driver, you may have to take them to court in order to recover your losses.