News: 2009 Press Release
For Release: May 1, 2009
Media Calls Only: 916-492-3566
Insurance Commissioner Poizner Urges Drivers Not to Cancel Auto Insurance to Save Money, Offers Affordable Option for Bakersfield Residents
In light of skyrocketing unemployment rates and harsh economic conditions, Insurance Commissioner Poizner today offered struggling Bakersfield residents an affordable automobile insurance option through the California Low Cost Automobile Insurance program.
"Unemployment is almost sixteen percent in Kern County, and many families are having trouble paying their bills," said Commissioner Poizner. "In this economy, lots of families are trying to find ways to cut expenses. Some may even consider cancelling their automobile insurance. But I want to warn all Bakersfield residents - driving without insurance is illegal and puts everyone on the road at risk. Kern County drivers should shop around for the best auto insurance rate to fit their individual needs. The Low Cost Auto Insurance program is one affordable insurance option for recently unemployed drivers."
Motorists driving without insurance can have their vehicle registrations suspended by the Department of Motor Vehicles under SB 1500, which became effective Jan. 1, 2006, as part of legislation designed to reduce the risk of economic losses sustained as the result of collisions involving uninsured motorists.
The low cost auto insurance program provides eligible good drivers with auto liability coverage, currently for under $400 a year and as little as under $300 a year in many counties. In Kern County, an LCA policy costs $254 per year. Since its inception, approximately 45,000 policies have been issued statewide. In Kern County, 136 policies have been issued since the LCA program was made available there in 2006. Program policies are issued by California licensed insurers and the program is administered by the California Automobile Assigned Risk Plan.
The California Low Cost Automobile Insurance Program is 100 percent unsubsidized by taxpayers. The program is self-sustaining. Rates are set in each county so that premiums are sufficient to cover losses and expenses in each county.
There are a number of eligibility requirements for the program, including:
- An applicant must be a "good driver" - no more than one at-fault property damage only accident, or one point for a moving violation in the past three years.
- An applicant must be at least 19 years of age with 3 or more years of continuous driving experience.
- No at-fault accident involving bodily injury or death in the past three years and no felony or misdemeanor conviction for a violation of the Vehicle Code.
- Family income cannot exceed 250 percent of the federal poverty level ($26,000 for a single person, $35,000 for two persons and $53,000 for a family of four).
- The value of an insured vehicle must not exceed $20,000.
For more information about the program, call 1-866-60-AUTO-1 (1-866-602-8861)
The California Low Cost Automobile Insurance Program was established in 1999 as a pilot program in Los Angeles and San Francisco. SB 20, passed in 2005, authorized the Commissioner to launch the program throughout the state upon his determination of need in each county. Beginning in April 2006, the department began expanding the program statewide. Commissioner Poizner made the LCA program available to every county in the state in December 2007.
Please visit the Department of Insurance Web site at www.insurance.ca.gov. Non media inquiries should be directed to the Consumer Hotline at 800.927.HELP. Callers from out of state, please dial 213.897.8921. Telecommunications Devices for the Deaf (TDD), please dial 800.482.4833.
If you are a member of the public wishing information, please visit our Consumer Services.