California Low Income Car Insurance
The California low income car insurance allows people who have a certain age, some income limitations and meet the driving record requirements to buy a special insurance policy at a discounted rate. The general desire is to extend this program through the end of 2015.
In fact, the California low income car insurance program was the first of its kind to be implemented in the nation. It began in the Los Angeles area, being considered a pilot experimental program, but by the end of 2006 it expanded all across the state. It also turned to be quite an example for other states that considered implementing it themselves, because its goal was to reduce the number of uninsured drivers that were on the highways. The central idea of the California low income car insurance is that if a driver meets a few conditions, he will be able to purchase the basic liability coverage at a lower price than usual. This way, the state thought it can reduce the number of uninsured drivers by offering a less expensive car insurance for residents with low-income.
When it comes to numbers, the California low income car insurance will oblige drivers to pay around $300 a year for their minimal car insurance, the actual cost being slightly different from county to county. The coverage that is ensured by this payment rates is of $10,000 per person, of $20,000 per accident (used to compensate people for the bodily injures that they might suffer as a result of an accident) and of $3,000 for incidents that result in public or private property damage. It is generally believed that the affordable cost will result in less low income people driving uninsured.
In order to be able to become part of this program a driver must meet some conditions. First of all, the driver must be at least 19 years old and must have a minimum of three years of driving experience as a licensed driver. Secondly, the value of the car that needs insurance must be of less than $20,000. Thirdly, the monthly income of the driver must not exceed 250% of the poverty level. That means a maximum limit of $35,425 for a family with two members and a maximum limit of $55,125 for a family of four.
The disadvantage is that the driver doesn’t get to choose the insurance company that will provide the insurance. Usually, the state is the one who rules which company will provide the insurance in order to distribute the beneficiaries of the program to more than one company. If only one company would insure all these people, the company might find it necessary to raise the rates for other drivers in order to stay competitive on the market. When the state has a saying in the matter, companies might perceive the California low income car insurance program as an incentive for more costumers.
Another important piece of information is that if a driver opts for the California low income car insurance program he will not be able to buy any other policies from an insurer. He will be exclusively covered by the program, although in regular policy coverage it is possible for a vehicle to be covered by multiple car insurance policies.
In the end it’s all about the safety of drivers and if income it’s a problem that might prevent a driver from buying insurance, he should check out this program. Even if the coverage is not that impressive it’s an opportunity to drive legally and have at least a minimum safety net in the event of an accident.
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