How much insurance must I carry?
California State law requires that motorists carry a minimum amount of liability insurance of $15,000 for bodily injury to one person, $30,000 for bodily injury to all persons, and $5,000 for property damage in any one accident. The law also requires all auto insurance policies to offer uninsured motorists coverage (for bodily injury), subject to the same minimums. You are not required to purchase this coverage however, it is recommended that you do as 25% of California drivers are uninsured.
It is recommended in California that you purchase limits no less than $100,000 / $300,000 /$100,000 with matching uninsured/underinsured limits.
What is the difference between "cancellation" and "non-renewal" of a policy?
Under the Insurance Law, a personal automobile insurance policy must remain in effect for a required policy period outlined on your policy. If an insurer decides not to renew the policy at the expiration of this period, this is a "non-renewal". However, if the insurer terminates the policy at any other time (which can only be done under limited circumstances), this is a "cancellation".
Are my auto insurance rates affected by where I live?
Insurance rates are based upon the company's underlying costs, which include the number of claims and the severity of those claims. Traffic patterns, population demographics, and the cost of goods and services contribute to insured cost variations. For example, if Town A's loss experience is more severe than that of Town B, then auto premiums in Town A will be higher than those of Town B.
What discounts can I get on my car insurance?
There are a number of available discounts in California to help reduce the cost of an individual's auto insurance policy. Some of these are:
Can my insurance company raise my premium due to an accident or traffic ticket?
There are several reasons why your insurance policy may increase. One reason is the "Accident Free / Incident Free" discount that you no longer qualify for. This is equal to as much as a 5% disount. Another reason for such an increase may be due to a surcharge. Surcharges are based on the fact that a driver who has previously been at fault in one or more accidents, or has a record of traffic convictions, has an increased likelihood of being involved in future accidents.
Insurers "classify" drivers according to such criteria as age of driver, geographical location, mileage and type of vehicle. To further refine those classifications, many insurers use "merit rating plans", a point system in which increases are applied according to an individual driver's record (traffic convictions and accidents).
A surcharge is used as a tool to properly price the exposure the insurer is writing, and not as a means to recoup payment made under a claim. The total dollar amount paid as the result of a claim does not affect the surcharge. The policy holder being surcharged for a particular accident will pay the same amount regardless if the damages were (for example) $2,000 or $50,000.
Why are auto insurance rates higher for younger drivers?
Insurance rates are based on the average experience of a group of persons with similar characteristics (classification). Young drivers historically have had poorer loss experience (both in the frequency of accidents and the cost of those accidents) than older drivers. By charging young drivers higher rates, those drivers pay their fair share of insurance costs and older drivers are not asked to subsidize them. In addition, rates are generally higher for males because, consistently, female drivers incur fewer and/or less severe claims than males.
Is my insurance company allowed to automatically include my son/daughter on my policy?
An insurer is permitted to consider all resident operators of an insured vehicle in the rating of an automobile policy, including a child, although he/she may only have a learner's permit. This is because insurers are permitted to use classifications that reflect a possible exposure for liability on the part of the insurer, in the event that bodily injury or property damage occurs due to that child's operation of the vehicle. Such a "limited use" classification, however, reflects the reduced likelihood of an incident due to "occasional" operation by a youthful driver, and is rated lower than if that person were the "principal operator".
How do I know if I am being charged the right premium?
This Department each year responds to numerous requests by individual insureds regarding the amount of premium charged for their private passenger automobile insurance policies. In the overwhelming majority of cases, we have found that insurers have rated the policy correctly, assuming that the information on which the policy is being rated is correct. Therefore, it is important that you review your policy declarations page(s), to ensure that the information is correct. Working with Integrity Now Insurance Brokers, we will help make sure the premiums being charged are correct.
My insurance company is rating me based on something (an accident or traffic ticket) that didn't happen. Where does this information come from and how can I correct any errors?
In addition to driving records from the Department of Motor Vehicles, automobile insurers may obtain information about your insurance and driving history from other sources. One such source is CLUE (Comprehensive Loss Underwriting Exchange), an information database used by insurers. This system, which functions similar to a credit reporting agency, gathers data from insurers regarding their past and present insureds' claim histories. When an insurer writes and/or rates a policy, it may request a report on an applicant/insured from this system. The insurer does have the right to pertinent information regarding any risk they may consider accepting, which includes information on accidents and/or traffic violations.
What is a "deductible"?
A deductible is an amount that you agree to be responsible for in the event of a loss under the physical damage (collision or comprehensive) coverages of your policy. Deductibles are offered on some coverages to give insureds flexibility in the cost of insurance and the amounts they wish to be responsible for. You may reduce your auto insurance costs by raising the deductibles on physical damage coverages. You should review the amount of the deductibles you now carry on these coverages to determine whether it makes sense for you to absorb a larger portion of your loss in the event of an accident, in return for a lower premium charge.
Am I protected by my insurance when I drive a rental car?
Your motor vehicle liability insurance policy covers you for bodily injury and property damage liability, as well as no-fault, when you drive a rental vehicle. However, this coverage is provided on an "excess" basis, which means that your policy will cover you if the amount of damage or loss exceeds the insurance coverage provided by the rental vehicle company.
A rental vehicle company may hold a renter responsible for damage to, or loss of, rental vehicles, including loss of use. However, in most cases this coverage is not provided in your insurance policy. Some high end policies may provide this coverage, subject to certain exclusions in the policy and certain other exceptions. It is important to know that you as a renter may be held fully responsible for damage to a rental vehicle unless an "optional vehicle protection" is purchased from the rental vehicle company, or you have insurance coverage under your motor vehicle insurance policy or through your credit card.
What happens if I am injured by an uninsured vehicle?
Uninsured Motorists Coverage protects you, your family members who live with you, and occupants of your car, in the event they are injured as the result of negligent actions by an uninsured vehicle or hit-and-run motorist, in accidents occurring in California.
A claim may be filed with your auto insurance company under this coverage if anyone in your car is injured by the driver of an uninsured vehicle or a hit-and-run motorist, or if you or a member of your family is injured while in an uninsured vehicle, or injured as a pedestrian by an uninsured or hit-and-run motorist. If you do not own a car, but a relative in your household does, you may be covered under that policy. If no other coverage is available when injured as a pedestrian by an uninsured vehicle or hit-and-run driver or as an occupant of an uninsured vehicle in California, you may still be eligible for uninsured motorist protection from the Motor Vehicle Accident Indemnification Corporation (MVAIC).
This is one reason why it is important to carry Uninsured Mortorist coverage equal to your auto insurance that covers others. Why would you pay yourself less or not at all in the event the person who hit you is uninsured or underinsured.
My broker gave me a quote on my automobile insurance, but when I got the policy the premium was much higher. Do I have to pay the premium that the insurance company is asking for? Why?
Yes, you have to pay the premium that the company is asking for. The company must charge the premium in accordance with the rates that they have on file with this Department. There are several reasons why the company's premium may be higher than the quote provided by the broker. For example, the company may be applying a surcharge for an accident or ticket that the broker was not aware of. If you feel that your broker gave you an erroneous quote deliberately in order to sell you the policy, you may file a complaint with this Department. Integrity Now Insurance Brokers will provide you with a finalized quote so there are no surprises.
The insurance company pays the broker a commission on my policy, why do I have to pay a broker's fee?
The broker is permitted by the Insurance Law to charge a fee over and above premiums, with the insured's signed consent. In order for the broker to collect a fee, the insured must sign an agreement acknowledging the amount to be charged. Once the proper form is signed, there is no limit on the amount to be charged, provided that the amount is acknowledged in the agreement.
Integrity Now Insurance Brokers does not charge a broker fee for your auto or homeowners policy.
I had an accident or loss. How do I submit a claim?
Send a letter or call the insurance carrier that you are insured through if you wish to file the claim. Your Auto ID Card has the phone number to call in the event of an accident.
What is an adjuster?
An Adjuster handles claims on behalf of an insurance company. This person receives either fees or compensation from the company for which he/she is hired to review (adjust) claims.
What is an appraisal clause?
The appraisal clause is a provision which may be in your policy and is used to resolve a dispute where the only question is the amount of damages. The clause provides that the claimant and the company each pick an appraiser and the appraisers are left to come to an agreement. For issues that cannot be resolved by the appraisers, an umpire is chosen to make a determination.