Low-Income Car Insurance Remains in California

Gov. Arnold SchwarzeneggerA program giving greater access to low-cost policies will remain in California for another five years, as Gov. Arnold Schwarzenegger signed legislation yesterday that extends a government-run program offering minimal car coverage for minimal cost to low-income Californians.

The California Department of Insurance says more than 50,000 people have been able to obtain policies through the plan, known as the California Low Cost Automobile Insurance Program (CLCA).

Through the CLCA, low-income motorists can obtain a bare-bones California auto insurance policy for rates between $161 and $368 per year. Those figures are less than half the average coverage expenditure made by California motorists in 2007, according to the National Association of Insurance Commissioners.

Among other eligibility requirements, motorists who may participate in the program must be at least 19 years of age and have at least three years of motor vehicle driving experience, as well as a driving record that is in “good standing.” In addition, household income must not exceed a certain threshold, depending on family size.

The basic plan provides $10,000 in bodily injury liability per person and $20,000 per accident, plus $3,000 in property liability per accident. For additional fees, a motorist can get medical and uninsured motorist coverage.

With the unemployment rate remaining at over 12 percent for several months, the number of Californians standing to benefit from the CLCA is large. Last year the program received more than 6,000 applications.

The program was set to expire on Jan. 1, 2011.

About Ben Zitney
Benjamin Zitney has been covering the auto insurance industry for the past 2.5 years. Before coming to Online Auto Insurance News, he produced an extensive company history of the 30-year-old California Joint Powers Insurance Authority and worked at the Cal State Long Beach Daily Forty-Niner as a reporter, copy editor and news editor.

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