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Is California a no-fault state?

California is not a state that follows a no-fault policy when it comes to dealing with automobile accidents. Most states in the country follow the guidelines of what is called the "Financial Responsibility System" or a Tort system. Understanding the system under which your state operates will help you determine what forms of insurance coverage you will be required to carry. The rules of a no fault system state that in the event of a car accident, each driver assumes equally responsibility for the accident. An individual's vehicle insurance company is responsible for only for the medical expenses and property damage repair costs for that one individual.

In you live in a state with a no fault system, you will most likely be required to carry uninsured motorist insurance and personal injury protection (or PIP) insurance. PIP insurance provides a certain monetary amount toward the emergency medical treatment of you and your passengers. Because most people are covered by a comprehensive health plan, most motorists do elect to carry more than the minimum required amount of PIP insurance.

Uninsured motorist insurance offers you coverage in the event that a motorist strikes you who does not have insurance or whose insurance is inadequate to meet your state's guidelines. There are a handful of states of who follow a Tort system but still require their citizens to carry uninsured motorist insurance. California is not one of them.

If your state follows a Tort system and an accident occurs, then one driver must be determined to be at fault in the accident. Most states abide by this system, with California being one of them. This party from the accident and his or her insurance company then becomes financially responsible for all of the medical expenses and repair bills for all parties involved in the collision. Generally, within Tort states, a minimum liability policy will be sufficient in allowing you to drive legally. Collision insurance will be required if there is an outstanding loan on your vehicle, and many motorists opt for a comprehensive insurance plan to further supplement their coverage. The aim of states that operate under a Tort system is to ensure that motorists carry enough coverage to provide for the needs of other parties if they are involved in an accident.

The state law in California requires that a motorist must maintain a minimum Bodily Injury Liability limits of $15,000 per injured person up to a total of $30,000 per accident, and Property Damage Liability coverage with a minimum limit of $5,000. California has one of the lowest minimums in the country when it comes to the required liability coverage for property damage. If the costs of repairs towards a damaged vehicle are in excess of $5,000, the insured is responsible for the remaining balance. This is why most drivers elect to purchase more than the required amount of coverage. Additionally, should a motorist allow their insurance coverage to lapse, an insurance company is required to notify the Department of Motor Vehicles for the state. The DMV will then suspend the registration of the vehicle in question until they are notified and have received proof that the coverage has resumed.


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