Despite mandatory insurance and financial responsibility laws, some drivers carry insufficient auto insurance or none at all. In many states, uninsured drivers who are injured in vehicle accidents are permitted to collect non-economic damages from the at-fault party. California addressed this inequity in 1996 when it enacted its "no-pay, no-play" vehicle insurance law, which prevents such drivers from receiving the full benefit available from a system they don't help to support.

Financial Responsibility

The California Vehicle Code rests on the idea of "financial responsibility," which states that all drivers and owners of a motor vehicle must be financially capable of paying the costs resulting from a vehicle accident. This capability is demonstrated in California primarily by securing auto insurance for at least the minimum level of coverage. The state permits drivers to establish alternate forms of demonstrating financial responsibility, such as securing a certificate of self-insurance, purchasing a surety bond, or depositing $35,000 -- the gross amount of statutory auto insurance -- with the California DMV. (see Resources)

California Vehicle Insurance Requirements

For California drivers who elect to meet their financial responsibility requirement by securing auto insurance, state law requires a minimum liability coverage of 15/30/5 -- $15,000 coverage for bodily injury for each person injured, to a maximum of $30,000 for all such costs, and $5,000 coverage for property damage. This minimum does not cover the cost of any damages to your vehicle, for which you need comprehensive and collision coverage. Proof of insurance should be available at all times while driving and presented to law enforcement upon request.

No-Pay, No-Play

California's No-Pay, No-Play legislation states that a driver without basic insurance coverage who is injured in a vehicle accident may not recover non-economic damages such as pain and suffering or inconvenience, although actual bodily injury and property damages may be recovered.

Other Considerations

No-Pay, No-Play is only one of several penalties California imposes on motorists who drive without at least the statutory minimum insurance coverage. If you are pulled over for any reason and do not have insurance, you may be fined $100 - $200 is it's a first offense. If you're involved in an accident, though, even if you aren't injured, you will likely lose your driving privilege for up to four years, and when you have it restored, your insurance costs will be very high.