(BPT) – The state of California has not raised auto legal responsibility protection limits for greater than 50 years, however that’s set to vary starting subsequent yr. The brand new laws, launched in 2022 to maintain tempo with rising medical and restore prices, would require increased legal responsibility protection limits for drivers and can take impact on Jan. 1, 2025. As we method the brand new yr, Mercury Insurance coverage desires to assist customers higher perceive what these new limits entail.
“With the rise in legal responsibility protection limits, California drivers might be extra more likely to have the protection they should pay for an accident with out going into debt,” mentioned Justin Yoshizawa, Director of Product Administration for Mercury Insurance coverage. “Nevertheless, some drivers might discover a rise of their premiums subsequent yr, which suggests now is a good time to get in contact together with your insurance coverage agent to assessment your coverage and maximize financial savings with potential reductions.”
Here is what California drivers ought to know concerning the mandate:
What are the brand new protection limits?
At present, California requires motorists to hold legal responsibility insurance coverage with minimal limits of $15,000/$30,000 for Bodily Harm and $5,000 for Property Injury. Beginning in 2025, this may improve to $30,000/$60,000 for Bodily Harm and $15,000 for Property Injury.
When will the brand new protection limits take impact?
New legal responsibility protection limits will go into impact on Jan. 1, 2025. Drivers who’re impacted ought to see the change of their subsequent coverage renewal after that point.
Why is this transformation taking place?
Regardless of being residence to essentially the most licensed drivers within the nation, the state of California has not raised auto legal responsibility protection limits for the previous 56 years. Throughout that point, the prices related to stepping into an accident — medical payments and restore prices — have risen considerably as a consequence of inflation. The adjustments are supposed to supply California drivers with better monetary safety amid these rising prices in the event that they have been to get into an accident.
Will this have an effect on insurance coverage premium for drivers?
It will have an effect on premiums for drivers who at present carry the minimal protection and are bumped as much as the brand new limits on account of the mandate.
What do drivers must do now?
No motion is required on the a part of drivers. All present insurance policies with decrease limits might be renewed with the adjusted minimal limits on or after Jan. 1, 2025. Nevertheless, it will be a good suggestion to succeed in out to your insurance coverage agent to assessment coverages and potential reductions which may be provided.
“These new protection limits will stay in place for the subsequent 10 years, after which one other improve will go into impact,” mentioned Yoshizawa. “The excellent news is that California drivers might be extra adequately insured to cowl repairs or accidents following an accident.”
