For more than 10 years, California's Low Cost Auto Insurance Program (CLCA) has been providing auto insurance coverage for those who otherwise wouldn't be able to afford it. In October 2011, Gov. Jerry Brown signed a new law that should make it much easier for low-income drivers to get this special coverage -- by making it available online.
In the past, according to a press release about the new law from advocacy group Consumer Watchdog, low-income drivers who wanted to take part in CLCA faced several hurdles. For one thing, they had to find an agent who was authorized to sell the low-cost insurance and pay multiple visits to the agent's office to fill out the necessary paperwork. For another, some agents were not following the previous law that required them to provide information about CLCA to qualifying customers -- meaning some who were eligible for the program may not have known about it.
Under the new law, the state's insurance department, along with CLCA, will establish ways for those who qualify for CLCA to get auto insurance online. The insurance likely will be available through CLCA's website as well as through state-approved agents' websites.
How CLCA works
Although the rules have changed, the intent of CLCA is the same -- helping low-income residents get coverage they can afford, while protecting everyone on the road by reducing the number of uninsured drivers. Basic liability policies start at less than $300 in some counties. CLCA policies do not include collision or comprehensive coverage, but these optional types of coverage can be purchased separately.
Not everyone qualifies for CLCA. Some basic requirements include:
- Having a good driving record. Drivers who have had more than one at-fault property damage accident, or more than one point deducted for a moving violation in the past three years, need not apply. An at-fault accident within the past three years that resulted in injury or death will also disqualify a driver, as would felony or misdemeanor violations of the California Vehicle Code.
- Being at least 19 years old.
- Having a valid license that has been in effect for the previous three years.
- Owning a vehicle valued at less than $20,000.
- Earning income under $27,225 for one person. For households of more than one person, income eligibility increases according to household size.