How much is car insurance in California & how to lower it?

If you get a speeding ticket, chances are you'll see an increase in what you pay for car insurance, upon your policy renewal. Typically, you'll pay more for three years. But even with a traffic ticket, comparison shopping can save you money. For instance, you'll see that the difference between the highest rate and the lowest in the table below is $1,320, on average, according to CarInsurance.com's rate analysis. That's how much you can save by comparing car insurance companies.

You’ll see in the chart below which car insurance companies have the lowest rates for young drivers buying a full coverage policy. Average car insurance rates by age data shows that drivers typically pay higher rates until age 26, when rates begin to drop as drivers gain more experience on the road. But even young drivers can save money by comparing car insurance rates to see which company has the lowest rates, by qualifying for student discounts and by staying on their parents’ policy as long as possible

Below you can see how average rates compare, by company, for drivers age 65 and over, buying a full coverage policy. Comparing car insurance quotes is always one of the best ways to save on coverage, regardless of age, but another way to trim costs for seniors is by qualifying for mature driver discounts.

Geico has the cheapest car insurance in California, among the major carriers surveyed by experts at CarInsurance.com. Gieco came in as the most affordable for all three coverage levels that are commonly bought by drivers. That means Geico has the cheapest liability car insurance in California, and is the cheapest full coverage car insurance company in the state.

Geico beat other major carriers on price for state minimum liability insurance as follows:

• $140 less than United Financial
• $290 less than Allstate
• $320 less than State Farm
• $360 less than Farmers
• $370 less than Amco

Here is how much cheaper Geico is, on average, compared to other companies’ rates for full coverage:

• $305 less than United Financial
• $730 less than Allstate
• $855 less than State Farm
• $895 less than Farmers
• $1,020 less than Amco

Scores are based on Insure.com’s “Best Insurance Companies” customer review survey of 3,700 customers. Policyholders ranked insurers on claims handling, customer service, value, mobile apps/website usefulness and were asked if they would renew their coverage and if they would recommend the company. All scores are out of 100.

*Auto Club of Southern California(Auto Club Enterprise Insurance Group)

California joins five other states that have either banned the use of gender in pricing auto insurance or that require unisex pricing, says CarInsurance.com Senior Consumer Analyst Penny Gusner. Insurers have until July to submit gender-neutral auto rating plans to the state's Insurance Department for review.

Using gender is somewhat controversial as insurance companies maintain it’s a fair practice based on their actuarial research, while consumer advocates argue it is discriminatory. "The California ban comes on the heels of another law that went into effect there this year, which allows residents to choose ‘nonbinary’ rather than ‘male’ or ‘female’ on driver licenses. I wouldn’t be surprised if other states begin to consider prohibiting the use of gender when setting car insurance rates as more people and state legislators are challenging the notion of using just ‘male’ and ‘female’ on identity forms," says Gusner.

Novice female drivers will generally be impacted the most, by paying more, if gender is taken out of the rate calculation. Female drivers from age 16 to 24 pay, on average, around $500 less (15 percent) a year for car insurance compared to their male counterparts, according to CarInsurance.com’s rate analysis. Our rate data show from age 25 to 65 rates for males and females are within five percent of each other, with rates for males a tad cheaper from age 45 to 75. After age 75, females start again to pay less, but only around 7 percent, or $100, annually.

The use of gender in setting auto rates highlights how much state insurance laws can differ. Another example: there are three states (California, Hawaii and Massachusetts) that prevent credit history from being used to set car insurance premiums. There are also varying laws and rules on how rates, and rate hikes, are regulated.

Other states that ban use of gender in determining car insurance premium: Hawaii, Massachusetts, Montana, North Carolina and Pennsylvania. In Michigan the use of gender in setting rate is technically prohibited but reports suggest that a loophole in the law allows the practice.

Here are the highways and roads where the most fatal accidents happened in 2017, according to the most recent data available from the Fatality Analysis Reporting System research compiled by the National Highway Traffic Safety Administration

Under Prop 103, drivers who meet these conditions must receive rates at least 20 percent lower than a driver who does not meet these criteria at the same car insurance company:

• Has been licensed for at least three consecutive years
• Has no more than one point on his or her driving record for past three years
• Has not been convicted of DUI in past seven years
• Has not been in an at-fault accident for past three years

In California, if you cannot find a car insurance company that will insure you, you can get liability coverage through the California Automobile Assigned Risk Plan (CAARP). This plan is designed for high-risk drivers who are unsuccessful in obtaining insurance from companies that sell non-standard policies.

The plan works by taking your application and assigning it to an insurance company. All insurance companies licensed in the state must accept CAARP applicants. The number of CAARP assignments is based on insurance company market share. The more policies an insurance company issues, the larger the portion of CAARP assignments it is required to take.

The rates used by the plan are the same no matter what insurance company issues the policy. The plan also offers installment options. After three years with a clean driving record, you can get out of the CAARP program and buy a standard policy.

To buy a CAARP policy, you have to work with an agent who is certified by the state to assist in getting drivers these special policies. Start by calling the number below to be paired up with a “certified producer” in your area who will help find an insurer for you. Afterwards, you and your assigned certified producer will work with the insurance company’s agent to get you an appropriate policy.

To Find a CAARP Certified Producer, call 1-800-622–0954

If you are low-income, you may be eligible for the California Low Cost Auto Insurance program, which permits lower liability limits of:

• Bodily injury liability - $10,000 person / $20,000 per accident
• Property damage liability - $3,000 per accident

The low-cost program (rates range from about $241 to $556 a year; discounts are available for those who have had a clean driving record for three years) is available to drivers who meet the following criteria:

• Have a valid California driver’s license
• Own a vehicle valued at $25,000 or less
• Be at least 19 years old and meet income eligibility guidelines

Income eligibility requirements per household effective February 2016 are:

• 1 person - $29,700.00
• 2 people - $40,050.00
• 3 people - $50,400.00
• 4 people - $60,750.00
• 5 people - $71,100.00

California is among the 13 states that have a pure comparative fault rule. States with pure comparative negligence laws let all drivers recover some payment for their damages, even if they are mostly to blame. For example, a driver 70 percent at fault in an accident could make a claim for damages against the other driver's liability coverage but expect to receive only 30 percent of the claim amount.

You should file a claim promptly after an accident. Your policy should state what is required of you, which may say a reasonable time period or give a specific time-frame in which to make the claim. For instance, you typically must file a stolen car claim within 30 days of the theft.

California requires an acknowledgment of all claims within 15 days. Under California law, insurance companies are required to accept or deny the claim within 40 days after receiving proof of the claim. If the claim is accepted, payment must be made within 30 days from the date settlement was reached. 

You have up to three years to file a property damage lawsuit. 

California law requires that you file medical claims within two years of the incident. You have up to two years after the incident to file a personal injury lawsuit.

You shouldn’t assume there’s a grace period, and instead plan to have insurance in place. If you’re buying a new car, and don’t currently have insurance, you must have coverage before you drive the car off the lot. If you have insurance and are adding the new car to your existing policy, the time you have to add the car varies. Typically, you have five to 10 days to add the car to your policy. But other companies require you to do it immediately.

If you have insurance, your existing coverage amounts generally extend to the new car. That means in some cases you may want to add additional coverages, comprehensive and collision, or raise your liability limits, to ensure your new car is sufficiently covered.