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In San Leandro, California, drivers are required to show financial responsibility for their vehicles. This protects other people in the event of an accident, and it helps shield drivers from lawsuits.

Choosing the right insurance plan may feel overwhelming because there are so many options to consider, but it doesn’t have to be a complicated process. Here are the facts you may want to keep in mind when choosing your auto insurance provider and protection levels.

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State Limits

The State of California mandates a basic level of coverage that must be maintained by all drivers.

The bodily injury limit for a single person injured in one accident is $15,000, and drivers should have coverage for up to $30,000 per accident in case multiple people are injured. Additionally, drivers should have $5,000 in personal property coverage for damage caused to someone else’s car or other property.

There are a few ways to show personal financial responsibility, but auto insurance is perhaps the simplest and affordable options. The range of options includes:

  • A surety bond for $35,000 from a company licensed to provide this service in the state of California
  • DMV-issues self-insurance certificate
  • Cash deposit with the Department of Motor Vehicles
  • An automobile insurance policy from a company licensed in the state of California

Understanding How Insurance Works

Insurance is there to cover losses in the event of an accident, but the insurance company limits their losses by imposing limits on every policy. These limits will have an impact on the premiums, so policies with higher coverage levels will typically cost more.

However, the extra cost is well worth it to ensure that your protection is truly effective.

When a person is involved in an accident, the insurance will only provide payment up to the stated coverage limits.

If you have the state minimum of $5,000 for property damage and get in an accident with a brand new luxury sports car, chances are good that $5,000 will not be nearly enough to cover the damage and get that car back to pre-accident condition.

The victim can then sue you personally for the difference between the actual losses and the $5,000 limit paid by the insurance company. The same is true for medical bills and personal injuries.

Furthermore, liability insurance only covers the other party in the accident.

It does nothing to pay for your own losses and damages. In the event that you cause an accident, this would be covered under collision insurance which is an additional coverage option and charge.

If you’re worried about your car being damaged by vandals or storms, then you’ll want to ask for comprehensive coverage to ensure that you can get it back in top condition.

Financial experts recommend reviewing your finances and carefully considering your limits. According to the Wall Street Journal, you should add up the value of all your assets and investments, and choose this as your coverage amount for bodily injury liability and property damage coverage.

Rate of Uninsured and Underinsured Drivers

California aims to protect people from unnecessary losses by imposing mandatory financial responsibility laws, but not everyone will obey the law.

In a 2014 study by the Insurance Research Council, it was found that 4.1 million people in California are driving without the proper coverage.

This means that either they don’t have insurance at all, or they’re only carrying the state minimum and will not be able to replace your brand new car if they should total it in an accident. This is why it’s important to invest in uninsured/ underinsured coverage.

With this additional insurance, your own company will pay for the damage to your property and your medical bills if the person who caused the accident is unable to cover all of your losses.

While the number of uninsured drivers around the nation is falling, California still has the highest level in the country. You may pay a little more for this coverage, but it can give you peace of mind to know that you’re fully covered.

Remember the Gap

If your car is totaled in an accident, the insurance company will base your payment on the value of your car.

Due to the rapid depreciation of cars, there is always the risk that you owe more on the car than it’s worth, and you could wind up having to cover this difference out of your own pocket.

The last thing you want is to continue paying on a car that you no longer have, but this isn’t a concern with gap insurance. This optional coverage is ideal for any financed car, and most people believe that it’s worth having for the peace of mind.

Full Disclosure of Coverage

Drivers in San Leandro are required to carry proof of financial responsibility in their car at all times.

Furthermore, auto insurance companies are required to notify the state if a driver cancels a policy or has lost coverage due to non-payment of premiums. Insurance cards are available from companies licensed in California.

Keep the card in your vehicle at all times, and give it to an officer in the event that you’re pulled over or involved in an accident.

When you sign up for insurance, the company should clearly state what your costs are, the coverage limits, and if there are any exclusions. These details are also outlined in your contract so that you’ll know what to expect should you ever have to file a claim.

Consequences for Non-Compliance

The consequences for driving without proper coverage can be harsh in California. If you are found driving without the insurance or proof of responsibility, then you can face fines and a suspension of your license.

Ways to Save

There are a few ways for you to save on insurance in San Leandro. Rather than lowering your coverage limits, consider raising your deductible.

This can help you save money every month while ensuring that you still have the coverage you need. If you do go with a higher deductible, be sure to put the money in a savings account so that you can cover it in the event of an accident.

You may also qualify for a range of discounts, including having more than one car or policy with the same company. Companies also offer discounts for:

  • Being a safe driver and avoiding accidents
  • Having safer vehicles
  • Maintaining a clean driving record without any tickets
  • Working in certain professions, such as education or public safety
  • Allowing the company to deduct payments from your account automatically

You can also save money by taking the time to shop around. Searching for better rates can help you save money over the coming years. When you start comparing rates, be sure that all companies are using the same insurance choices and coverage levels in their quotes.

Auto insurance is necessary, but that doesn’t mean that you have to spend your entire budget on the coverage.

While you don’t want to skimp on coverage, there are other smart ways to save. You can use these tips to choose the right coverage level while also shopping around for more affordable deals and companies.

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