Those who drive motor vehicles in California are required by California Vehicle Code Section 16028 carry proof of financial responsibility for the vehicle while driving and are required to produce this proof when requested by a peace officer or traffic collision investigator.
For most people, proof of financial responsibility will come in the form of proof of car insurance. However, proof of automobile insurance is not the only acceptable form of proof of financial responsibility. Other acceptable forms of proof of financial responsibility include:
- Proof of $35,000 cash deposit with DMV
- A certificate of self-insurance issued by the DMV
- A bond of $35,000 from a company licensed to do business in California
There are consequences to driving without financial responsibility for your vehicle in California, and some of these consequences are set forth in California Vehicle Code Section 16029.
Sanctions for driving without proof of financial responsibility in California
Those who are first convicted of driving without proof of financial responsibility in California are subject to a fine of at least $100 and no more than $200, in addition to the penalty assessment fee, which can increase your total cost by more than three times. The court can also confiscate your vehicle.
Those convicted a second time within three years of driving without proof of financial responsibility in California face a fine of at least $200 and no more than $500, plus penalty assessment fees . Again, the court can also confiscate your vehicle.
If your vehicle is impounded, you must show proof of financial responsibility for your vehicle and pay the storage and towing costs associated with impounding your vehicle in order to recover your vehicle.
California Penalty Assessment Fee
As mentioned above, if you are caught driving without insurance in California, you will not only be fined, but you will also be subject to penalty assessment fees. You may be subject to the following penalty assessment fees, depending on your location and what local authorities choose to apply:
Persons subject to each of these penalty assessment fees will see an additional $29 fee for every $10 or part of $10 of their fine. So if you’re fined $200, you’ll owe $780, and if you’re liable for the maximum fine of $500 for a second driving conviction without proof of financial responsibility in three years, you will owe $1,950.
Penalties for having an accident without proof of insurance in California
There are additional penalties if you end up in a car accident driving without proof of financial responsibility in California.
The first time you have an accident without proof of financial responsibility in California, in addition to the fines and penalty assessment fees described above, you will also be subject to a mandatory suspension of your driver’s license for one year. After that year expires, you can receive license reinstatement by keeping an SR-22 form for a period of three years. An SR-22 form is a certificate your insurance company provides to the DMV proving that you are insured.
For the second and subsequent convictions of being in an accident without proof of financial responsibility in California, you will be subject to a license suspension of up to four years. You can receive license reinstatement during the last three years of your suspension if you keep an SR-22 form.
Other consequences of driving without insurance in California
Fines, vehicle impoundment, penalty assessment fees, and license suspensions aren’t the only consequences of driving without proof of financial responsibility in California:
Your ability to recover damages is reduced if you don’t have insurance
Thanks to California Civil Code 1714. Negligence is the failure to take reasonable care to prevent harm. Economic damage is objectively calculable damage such as medical expenses and property damage, and non-economic damage is subjective damage such as pain and suffering.
California Civil Code 3333.4 states that those who drive without proof of financial responsibility and are subsequently involved in an accident cannot recover non-economic damages such as compensation for pain, suffering, disfigurement, physical disability or inconvenience. Proposition 213 stated that the reason was to prevent criminals from being rewarded for breaking the law.
There is, however, an exception to this: uninsured drivers who are injured by drivers driving a vehicle under the influence of drugs or alcohol are still entitled to recover non-economic damages.
You could be liable for other people’s damage if you don’t have insurance
Normally, when a driver’s negligence causes a car accident, those injured in the accident will be able to recover damages from that driver’s insurance company, either through a claim filed with the insurance company or by taking legal action.
However, if you cause an accident while uninsured, you may find yourself directly sued for damages, such as medical bills and property damage, suffered by those you injured. You could owe hundreds of thousands of dollars if this happens.
Your vehicle registration may be suspended if you do not have insurance
The California DMV can suspend your vehicle registration if:
- They are informed that you have canceled your insurance and that you are not replacing your insurance within 45 days
- You do not provide the DMV with your insurance information within 30 days of the transfer of ownership or initial registration
- You register your vehicle with a false insurance certificate
California car insurance requirements
If, like most drivers, you choose to go with proof of auto insurance as proof of financial responsibility for your vehicle, you must purchase insurance with liability coverage minimums established by California vehicle code 16056. These minimums are:
- $15,000 to cover the death or bodily injury of a person in an accident
- $30,000 to cover the death or bodily injury of two or more people in an accident
- $5,000 to cover any property damage resulting from an accident
Third-party liability is coverage that compensates people other than the policyholder in the event of material damage or bodily injury. Collision or comprehensive insurance coverage does not meet vehicle financial responsibility requirements.
California Low Cost Auto Insurance Requirements
Those whose household income falls below certain thresholds are eligible for California Low Cost Car Insurance Program. These thresholds are:
- $33,975 per year for a one-person household
- $45,775 per year for a household of 2 people
- $57,575 per year for a 3-person household
- $69,375 per year for a household of 4 people
- $81,175 per year for a household of 5 people
Liability insurance requirements for those enrolled in the low-cost auto insurance program are somewhat lower than for other Californians. They are:
- $10,000 to cover the death or bodily injury of a person in an accident
- $20,000 to cover the death or bodily injury of two or more people in an accident
- $3,000 to cover any property damage resulting from an accident
These lower insurance requirements allow insurance companies to offer more affordable insurance programs under the low cost car insurance program.
Proof of $35,000 cash deposit with DMV
Proof of a $35,000 cash deposit with the DMV is a form of proof of financial responsibility for a vehicle in California that some people may choose to carry in lieu of proof of insurance if they feel they spend too much money on long-term insurance premiums. . This proof will consist of a DMV acknowledgment letter indicating the filing number.
Self-insurance certificates issued by the DMV
A Certificate of Self-Insurance issued by the DMV is another form of proof of financial responsibility for a vehicle in California that some people may choose to carry instead of proof of insurance.
However, you must own more than 25 vehicles to obtain a self-insurance certificate from the DMV. You must also be able to cover property damage, vehicle repairs, or medical expenses in the event of an accident, and the DMV may ask you for proof that you can cover these things before issuing you a Certificate of Self-Care. insurance.
Bonds of $35,000
Another form of proof of financial responsibility for a vehicle in California that is an alternative to proof of insurance is a $35,000 bond issued by a company licensed to do business in California.
This bond guarantees that you will cover property damage, vehicle repairs or medical expenses when you cause a car accident. The surety company will cover these expenses for you if you cannot, but the surety company will then ask you to reimburse them.