Effective Jan. 1, California auto insurance policies must meet higher liability coverage limits under a 2022 law. Liability limits for bodily injury or death are doubling.
Coverage for bodily injury or death of one person rises to $30,000, while the limit for all persons increases to $60,000. Property damage coverage is tripling to $15,000.
In 2035, the limits will increase further: bodily injury or death of one person will rise by $20,000, and all persons by $40,000. Property damage limits will grow by $10,000 (see US Auto Insurance Rates by States).
State Farm highlighted that these updates address the state’s 56-year delay in adjusting limits. The changes aim to offer greater protection to drivers as medical and repair costs continue to climb.
The American Agents Alliance noted potential downsides. Increased limits could mean higher premiums for drivers with minimum coverage, potentially leading low-income individuals to forego insurance or join California’s Low-Cost Auto Insurance Program.
The alliance also warned that the higher limits might encourage more lawsuits, further driving up litigation rates.
In 2023, the top five private passenger auto insurers in California, ranked by direct premiums written, were State Farm Group (12.87%), Auto Club Enterprises Insurance Group (11.55%), Berkshire Hathaway Insurance Group (10.92%), Allstate Insurance Group (10.23%), and Farmers Insurance Group (9.85%).
