Calif. Low Cost Auto Program Expanded to Six Counties

California has expanded its Low Cost Automobile Insurance Program to low-income, good drivers in Merced, Monterey, Santa Barbara, Sonoma, Tulare and Ventura counties, announced the California Department of Insurance.

The program offers low-income, good drivers the opportunity to purchase auto insurance for less than $400 a year.

Commissioner Steve Poizner stated, “state law requires that all drivers be insured, but well over 160,000 motorists in these six counties are driving without insurance. This is a crisis. Many of these drivers simply cannot afford insurance, but they are placing themselves and fellow residents at risk when they drive. The goal of this program is to reduce the number of uninsured drivers on our streets, while making auto insurance affordable and available.”

The California Low Cost Automobile Insurance Program initially begun in 1999 as a pilot program in Los Angeles and San Francisco. A new law, SB 20, also authorized the Commissioner to launch the program throughout the state upon his determination of need in each county. Last April, the program was expanded to Alameda, Fresno, Orange, Riverside, San Bernardino and San Diego counties. Last June, the Department of Insurance further expanded the program to Contra Costa, Imperial, Kern, Sacramento, San Joaquin, San Mateo, Santa Clara and Stanislaus counties. With the March 30, 2007 expansion to Merced, Monterey, Santa Barbara, Sonoma, Tulare, and Ventura Counties, the Low Cost Auto Insurance Program will be available in 22 California counties.

Since its inception, more than 30,000 policies have been issued. Program policies are issued by California licensed insurers and the program is administered by the California Automobile Assigned Risk Plan. Rates are set in each county so that premiums are sufficient to cover losses and expenses in each county.

To be eligible for the program, applicants must be a “good driver” – no more than one at-fault property damage only accident, or one point for a moving violation in the past three years; and no at-fault accident involving bodily injury or death in the past three years; and no felony or misdemeanor conviction for a violation of the Vehicle Code.”)

Additionally, family income cannot exceed 250 percent of the federal poverty level ($25,525 for a single person, $34,225 for two persons and $60,325 for a family of five). The value of an insured vehicle must not exceed $20,000.

Source: CDI