California low income car insurance

California’s low income car insurance program provides low cost liability insurance for drivers who meet the eligibility requirements and maintain a good driving record.

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Rachael Brennan

Rachael Brennan

Property and Casualty Insurance Expert

Rachael Brennan is a senior insurance editor at Policygenius, specializing in auto insurance. She worked for 21st Century Insurance, BlueCross BlueShield Massachusetts, and HealthPass New York. She also spent two years working as a content expert for dozens of auto insurance websites through 360Quote LLC.

Published September 21, 2021|2 min read

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Auto insurance in California can be very expensive, with the average driver paying $1,978 per year for full coverage. Given the high cost of auto insurance in the state, how is someone who doesn’t earn much money supposed to afford insurance?

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In order to help individuals and families who can’t afford high premiums, the state created the California Low Cost Auto Insurance program. This helps provide insurance to people who might otherwise be priced out of the market by offering coverage below the minimum liability levels required for traditional auto insurance plans.

Key Takeaways

  • California’s Low Cost Auto Insurance program is designed to provide affordable insurance to low income residents of the state

  • The program legally allows drivers to have liability coverage at lower levels than the state’s minimum requirements to help reduce their insurance rates

  • The rates can vary by county, but the average program participant can expect to pay between $244 - $966 each year

  • To qualify for the plan, drivers must have a valid California driver’s license, meet financial guidelines, own a car worth less than $25,000, have a clean driving record, and be of legal driving age

What is the California Low Cost Auto Insurance program?

California’s Low Cost Auto Insurance program (CLCA) is designed to provide affordable insurance to low-income residents of the state. Drivers who meet the financial requirements and have a clean driving record are eligible for the program. Drivers who qualify for coverage must:

  • Have a valid California driver’s license

  • Meet financial guidelines

  • Own a car worth less than $25,000

  • Have a clean driving record

  • Be of legal driving age

The CLCA insurance program allows drivers to legally have liability coverage at lower levels than the state’s minimum requirements to help reduce their insurance rates. The policy provides coverage for up to two cars, a primary driver, and eligible secondary drivers.

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How much does the California Low Cost Auto Insurance program cost?

The rates can vary by county, but the average program participant can expect to pay between $244 - $966 each year. There are potential discounts available for people who have been a licensed driver for 3 years or more.

Program participants can either pay their premium in full or pay 20% with seven installment payments. Drivers who choose to make multiple payments should expect to pay an additional $4 fee with each installment.

Who is eligible for California Low Cost Auto Insurance?

Drivers who meet the financial requirements determined by the state are eligible for the program. The chart below shows the maximum qualifying income based on household size for 2021:

Number of People/HouseholdAnnual Household Income
1$32,000
2$43,550
3$54,900
4$66,250
5$77,600
6$88,950
7$100,300
8$111,650
9$123,000
10$134,350

Income limits aren’t the only factor that determines your eligibility—your driving record also determines whether or not you are eligible. In California, a one point ticket (speeding violation, running a red light, etc.) stays on your record for three years, while a two point ticket (reckless driving, DUI, etc.) stays on your record for seven years. 

What defines a good driver?

According to the CLCA program, a good driving record is defined as:

  • No more than one at-fault property damage only accident or no more than one point for a moving violation within the past three years

  • No at-fault accidents involving bodily injury or death on a driving record within the previous three years

  • No felony or misdemeanor convictions for a violation of the Vehicle Code on a motor vehicle driving record

Does the California Low Cost Auto insurance program offer enough coverage?

California’s minimum liability requirements are:

  • $15,000 for bodily injury liability per person

  • $30,000 for bodily injury liability per accident

  • $5,000 for property damage liability

Typically, California drivers must carry at least this much liability coverage to avoid facing legal penalties, but the CLCA program offers an exception to this rule. Drivers who are insured through the CLCA program have:

  • $10,000 bodily injury liability per person

  • $20,000 bodily injury liability per accident

  • $3,000 property damage liability

The coverage limits on the CLCA program are lower than the state minimum requirements, but the state has decided to waive the minimum liability requirements for those people who enroll in the program in an attempt to reduce the number of uninsured drivers in the state of California.

While it makes sense to offer more affordable insurance as a way to keep more drivers insured, the reality of the situation is that the state minimum coverage really isn’t enough to protect people in case of a serious accident, let alone the lower levels of coverage offered through the CLCA program. Drivers in California should carry the highest levels of liability coverage they can afford.

Frequently Asked Questions

Are there optional coverages on the California Low Cost Auto Insurance program?

For an additional charge of $39-$104 per year, drivers on the CLCA program can also purchase $1,000 in medical payments per person, $10,000 uninsured motorist bodily injury per person, and $20,000 uninsured motorist bodily injury per accident. The program does not offer comprehensive or collision coverage.

How do I enroll in the California Low Cost Auto Insurance program?

Drivers who are interested in applying for the program should go to the program’s website mylowcostauto.com to take the eligibility questionnaire and fill out an application.

What are the penalties for not having auto insurance in California?

According to the California Department of Insurance, you can be fined, your license may be suspended, and your vehicle could be impounded. If you are in an accident and you don’t have insurance, the penalties are higher and you will still be held liable for any damage you cause.