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California Cuts Discount Car Insurance Program Price

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SACRAMENTO (KCBS) – A little known state program that offers low cost car insurance to low-income California drivers just got cheaper.

In the Bay Area, a policy under the California Low Cost Automobile Insurance Program now costs $287 a year, down from $350.

“The cost of the annual premium for the low cost auto insurance is being reduced up to nine percent across California,” said Insurance Commissioner Dave Jones.

KCBS’ Anna Duckworth Reports:

To qualify, drivers must have to have a clean DMV record and earn less than $28,000. Although the program has been around since 1999, only 11,000 people are currently enrolled.

Jones said the price was lowered to encourage at least some of the state’s 4 million uninsured drivers to sign up. About 15 percent of those who get behind the wheel in California drive without auto insurance.

“One of the reasons why people haven’t taken advantage of it is they don’t know about the availability of the program,” he said.

The program was established to help low-income residents find affordable alternatives to meeting the state requirement that they buy car insurance. Just a handful of states offer low-income alternatives, including Texas, Hawaii and New Jersey.

Jones said the state was able to lower the premium price because fewer claims have been filed recently.

(Copyright 2012 by CBS San Francisco. All Rights Reserved. This material may not be published, broadcast, rewritten, or redistributed.)

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