California Auto Insurance Laws: Requirements, Penalties, and SR-22

To drive legally in California, you must carry liability insurance or another approved form of financial responsibility, and since January 1, 2025, California auto insurance requirements set minimum liability limits at 30/60/15. That means $30,000 for bodily injury or death of one person, $60,000 total when two or more people are hurt in the same accident, and $15,000 for damage to another person’s property. The previous limits were 15/30/5. If your policy was issued before 2025 and hasn’t renewed yet, you may still be on the old numbers; at renewal, the higher minimums apply automatically.¹

What Liability Coverage Actually Pays For

Liability insurance only covers costs you cause to other people. It pays the other driver’s medical bills, lost wages, and vehicle repairs up to your policy limits. It does not pay for your own injuries, your own car, or your own property. If your per-person limit is $30,000 and the injured party runs up $80,000 in medical bills, you personally owe the $50,000 difference. That gap is why many drivers carry limits well above the state floor.

Uninsured and Underinsured Motorist Coverage Comes Standard

Every California bodily injury liability policy must include uninsured motorist (UM) coverage unless you specifically reject it in writing. UM protects you when the at-fault driver has no insurance or carries too little to cover your losses. Your insurer must offer UM/UIM limits at least equal to your liability limits. You can reject the coverage or reduce the limits with a signed form, but they can’t drop below the Vehicle Code minimums.² If you never signed a rejection, UM is on your policy by default.

Alternatives to a Standard Insurance Policy

Buying a policy is the common path, but the Vehicle Code recognizes three substitutes:³

A cash deposit with the DMV in the amount specified by the liability minimums in Vehicle Code Section 16056. Before the 2025 increase, this was $35,000; because the deposit tracks the updated liability minimums, the required amount has risen.⁴
A surety bond from a licensed surety company in the same amounts required by Section 16056.
A certificate of self-insurance, available to organizations that register more than 25 vehicles with the DMV and can demonstrate sufficient financial resources.⁵

The deposit and bond exist for individuals who prefer not to buy traditional coverage, though the amounts make them impractical for most people. Self-insurance is built for fleet operators, not individual drivers.

The Low Cost Auto Insurance Program

The California Low Cost Automobile Insurance Program (CLCA) is a state-sponsored option for income-eligible drivers. To qualify, you must:⁶

Hold a valid California driver’s license
Own a vehicle valued at $25,000 or less
Be at least 16 years old
Meet income eligibility guidelines tied to federal poverty levels
Have a good driving record

CLCA offers liability limits lower than the standard 30/60/15, and by statutory exception those reduced limits still satisfy California’s financial responsibility requirement. Premiums are substantially lower than standard market rates.

Carrying and Showing Proof of Insurance

You must keep proof of financial responsibility in your vehicle at all times and show it to a peace officer during a traffic stop or at the scene of an accident.⁷ Officers can’t pull you over just to check insurance, but if you’re stopped for another reason and can’t produce proof, you can be cited separately. An insurance card on a smartphone carries the same legal weight as a paper card.⁸ You’ll also need valid proof when you renew your vehicle registration.

After an Accident

If you’re in a collision, you must exchange your driver’s license number, vehicle identification number, current address, and insurance information (the insurer’s name, address, and your policy number) with every other driver or property owner at the scene. Failing to do so is an infraction with a fine of up to $250.⁹

You must also file an SR-1 report with the DMV within 10 days of any accident involving an injury, a death, or property damage of $1,000 or more. The DMV uses the report to verify that everyone involved carried valid coverage. Failing to report can trigger an investigation and a possible suspension of your driving privilege.

Penalties for Driving Without Insurance

Driving uninsured is an infraction, but the money adds up quickly. California applies penalty assessments of roughly $2.70 for every $10 of base fine, which nearly quadruples the amount you actually pay.¹⁰

A first offense carries a base fine of $100 to $200. With penalty assessments, the real cost runs about $370 to $740.¹¹
A repeat offense within three years carries a base fine of $200 to $500, or roughly $740 to $1,850 after assessments.¹¹
The court can order your vehicle impounded. You won’t get it back until you show proof of insurance and pay all towing and storage fees.¹¹

The DMV can suspend your vehicle’s registration if coverage lapses. Reinstating a suspended registration takes new proof of insurance and a $14 fee.¹² The heavier hit lands if you’re in an accident while uninsured: your driving privilege can be suspended for up to four years, regardless of fault.¹³

What Uninsured Drivers Lose in Court

Under California Civil Code Section 3333.4, passed by voters as Proposition 213, an uninsured driver who is injured in a crash cannot recover non-economic damages. No compensation for pain and suffering, physical impairment, disfigurement, or emotional distress, even if the other driver was entirely at fault.¹⁴

Economic damages like medical bills and lost wages are still recoverable, but non-economic damages often make up the largest share of a serious injury claim. One exception: if the at-fault driver is convicted of DUI, the uninsured driver’s right to non-economic damages is restored.¹⁴

SR-22 and Getting Back on the Road

If your license or registration is suspended for an insurance-related reason, you’ll need to file an SR-22 certificate with the DMV. An SR-22 is not a type of insurance. It’s a form your insurer files certifying that you carry at least the minimum required coverage. If the policy lapses or is canceled while the SR-22 is active, the insurer must notify the DMV, which triggers another suspension.

Common triggers for an SR-22 in California include being in an accident while uninsured, being classified as a negligent operator based on points, or reinstating a license after a DUI suspension. The typical filing period is three years, and because the SR-22 flags you as high risk, premiums usually rise during that window. Reinstating a suspended registration requires proof of current coverage and the $14 DMV fee.¹² Reinstating a suspended license adds the SR-22 filing plus any administrative fees tied to the reason for the suspension.

1
California Legislative Information. California Vehicle Code VEH 16056
2
California Legislative Information. California Insurance Code INS 11580.2
3
California Legislative Information. California Vehicle Code VEH 16021
4
California Legislative Information. California Vehicle Code VEH 16054.2
5
Cornell Law Institute. California Code of Regulations Title 13 Section 221.00
6
CA.gov. California Low Cost Auto
7
California Legislative Information. California Vehicle Code VEH 16020
8
California Legislative Information. California Vehicle Code VEH 16028
9
California Legislative Information. California Vehicle Code VEH 16025
10
The Superior Court of California – Amador. Penalty Assessment
11
California Legislative Information. California Vehicle Code VEH 16029
12
California Department of Motor Vehicles. Suspended Registration Reinstatement
13
California Department of Motor Vehicles. California Driver Handbook – Financial Responsibility, Insurance Requirements, and Collisions
14
California Legislative Information. California Civil Code CIV 3333.4