Lafayette Car Insurance
The City of Lafayette is one of the few places between Berkeley and Walnut Creek that holds onto a semi-rural character with all of the amenities that you'd expect to find in the modern world.
With clean air, a high quality of living and a quality education system, Lafayette is a desirable place to live with a diverse population and many opportunities.
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While Lafayette is a unique place that's dedicated to police, planning, parks and public works, it's still an incorporation in California. Since it's part of the state, all residents are expected to obey state laws.
Since auto insurance laws are drafted and overseen by state officials, all residents of California should brush up on vehicle code to ensure they're complying before they register their vehicle or drive.
Proof of Financial Responsibility
California has a Financial Responsibility law that specifically says that you must carry evidence of your ability to pay for damages at all times.
One thing that's unique about California is that you have options. While a Financial Responsibility law is much different than a mandatory insurance law, a majority of people in the state still choose to carry insurance.
Evidence of financial responsibility comes in a few different forms.
It's essentially a way to prove that you have the necessary funds to pay others to recover from damages that you or someone in your home cause while you are driving a vehicle that you own. Here are some are approved ways to show evidence of financial responsibility:
- Post a cash deposit in the amount of $35,000 with the California Department of Motor Vehicles
- File a $35,000 surety bond that's issued by a California bondsman
- File a self-insurance certificate with the department when driving a vehicle owned by a company
- Buy an auto insurance liability policy through a company licensed in California
Why Buying Liability Insurance is the Most Popular Option
Insurance might not be mandatory but it's definitely the best evidence of financial responsibility for the average person.
Even if you have assets and cash on hand, you don't necessarily want to put either of them up as collateral to pay for damages. Since claimants can sue you for damages and pain and suffering, having added protection is key.
Instead of putting $35,000 and your property at risk, you can buy auto insurance and pay a small amount of money each month.
You do have to pay premiums consistently, but you'll have financial protection in today's litigious times. When you have a claim, you don't have to worry about paying for bills, court costs, and judgments with your property or future wages.
How much insurance are you required to buy?
If you don't have $35,000 or property to secure a bond, you're required by law to buy nothing less than a basic liability policy.
Liability insurance pays for bills that are presented by claimants if you're primarily at fault for a loss. In California, you must be at least 51% liable for a loss before your policy will pay anyone else.
There are two different components of third-party liability coverage and both are required under the state law. It's not possible to buy a policy that doesn't include both liability components. These components are called Bodily Injury and Property Damage.
- Bodily Injury Liability - $15,000 per person, up to $30,000 per accident
Bodily Injury, which often goes by BI, is a liability coverage that will disburse payments to pedestrians, drivers and other passengers that you injury while you're driving your car. Limits are set per person, but the total claim for injury can't exceed the per accident limit. Court fees and legal representation is paid for separate.
- Property Damage Liability - $5,000 per occurrence
Property Damage, which goes by PD, is the second component of liability coverage that covers repair bills and the cost to replace vehicles when they're totaled. The limit for PD coverage is on a per-occurrence basis and not a per vehicle basis. That means that you can cause minimal damage and still exceed your limits.
What are auto insurance companies required to offer you?
Not only do you have to be given the opportunity to buy higher limits of liability coverage, California auto insurance carriers are legally required to inform you of first-party coverage options.
You as a consumer aren't required to buy these coverage options, but you must sign a form saying you want to reject them if you don't put them on your policy.
The two coverage options that you must be offered to all car owners are Uninsured Motorist Protection and Medical Payments. While each of these options will bump your premiums, they're worth consideration. After all, liability coverage pays other people but all of the other coverage options that you can add to your policy pay you.
What does Uninsured Motorist Protection pay for?
Uninsured Motorist Protection pays for your medical bills, lost income, disability services, and pain and suffering when someone hits you and doesn't have the evidence of financial responsibility to pay for your damages.
The minimum amount of coverage that you can carry is $15,000 per person, up to $30,000 per accident.
Are uninsured motorists a problem in Lafayette?
The median household income in Lafayette is $136,438. While this is substantially higher than national average incomes, the cost of living in the city is extraordinarily high.
Because the cost of living is so high, uninsured motorists are still a problem.
If you look at the averages, 14.7 percent of drivers in California don't have insurance. Doing the math can help you determine how much risk is present in Lafayette. Since there's a population of about 8771 cars in the city, around 1290 drivers living in Lafayette are driving around the rural roads without a financial responsibility filing.
What does Medical Payments cover?
Medical payments is also a first-party coverage, but it's a coverage that doesn't have as many restrictions as UM. Medical Payments pays for your expenses regardless of fault. By law, the carriers in the state must offer you no less than $1000 per person in Medical Payments coverage.
Do you need Medical Payments coverage in Lafayette?
While it's not required, it is a coverage that can help you cover those immediate expenses for an ambulance or a hospital stay if you don't have health insurance.
It can also help you cover your high deductible or co-pay when you have medical insurance.
Since the cost of living healthcare index in Lafayette is higher than both the national average and the statewide average, having some added protection to pay for doctor bills is a good idea. Consider not just the minimum limits, but higher limits that'll pay for more than just basic healthcare services.
What's the penalty for driving uninsured?
Driving uninsured or with no type of financial responsibility can put so many people at-risk.
If you're thinking about saving money by dropping your coverage, think again. As long as your vehicle is registered in the state, it's your legal duty to maintain your coverage. Here are the consequences that you may face:
- A fine of $100 to $200 for a first offense
- Penalty assessments
- Court-ordered vehicle impound
- Suspended registration or license if you're involved in an accident with no insurance
- Registration reinstatement fee
- SR-22 requirement as proof of insurance for up to 3 years
Do you need to carry physical damage coverage?
Physical damage consists of comprehensive and collision. If you have both, you have what's called a full coverage plan. Full coverage isn't required by state officials but it is required by lenders.
If you have the option to buy full coverage, you should consider whether or not it's worth the cost.
Comparing cost and risk can be helpful when you're making a decision. Lafayette is very safe on the crime index. Only 43 motor vehicle thefts have been reported in the whole city, making the theft rate very low. If your premium for comprehensive is high and your vehicle value is low, dropping full coverage might be best.
The only way to compare costs and decide on limits is to get auto insurance quotes.
You can either get quotes direct through a company or through a broker. If you want to do everything online, using a brokerage-style comparison shopping tool is the best way to save time.