What Is SB1107, And How Will It Affect Californians?

On September 29, 2022, Governor Gavin Newsom signed legislation requiring California’s drivers to carry improved liability coverage. This improved liability coverage is intended to help protect those who have been injured or killed in motor vehicle collisions. This increase in policy limits may leave some consumers with questions regarding their insurance coverage. If you have questions about your insurance coverage going forward, please continue to read our blog outlining the details of SB1107. Additional questions regarding your current motor vehicle accidents can be directed to the highly qualified auto accident attorneys at Eason & Tambornini. 

Policy limits are the maximum amount an insurance company will pay per incident. Policy limits are a part of all insurance claims. However, auto insurance policies are some of the most used in the state.  In California, automobile policy limits have been a minimum of $15,000 per person and $30,000 per incident since 1974. This enforcement of policy limits is severely outdated, with most Californians carrying minimum levels of insurance.  According to the Bureau of Labor Statistics, the worth of the American dollar is roughly six times higher than in 1974. Although the American dollar has increased, the minimum amount of money to protect American drivers has not reflected the exact change in almost 48 years. Californians unable to maintain auto liability insurance may be fined, have their license suspended, or have their vehicle impounded. 

In summary, SB1107 is an act to add Section 12960 to the California Insurance Code and to amend, repeal, and add sections 16056, 16435, and 16451 to the California vehicle code.  This act was presented to Governor Newsom on August 26, 2022, and signed into California Law on September 29, 2022. For the average Californian, this will mean increasing the minimum levels of auto liability insurance that drivers and vehicle owners must carry. This minimum level will be updated for the first time since 1974 in 2025.  Since 1974, the minimum policy limits in California have been $15,000 per person and $30,000 per incident. In 2025, the limitations will change to $30,000 per person and $60,000 per incident. This modernization of insurance levels will allow low-income Californians an additional safety net when involved in motor vehicle incidents and provide a fair settlement to many Californians that have been injured in motor vehicle collisions.

The effects of SB1107 on the average Californian will improve the lives and recovery process of those injured in accidents in the state. Previously, the minimum limits have often not been enough to cover primary medical care for many injured parties.  The increase in limits will assist in making those injured in motor vehicle crashes whole after their accidents. It is difficult to predict how insurance carriers will react to SB1107 or if an increase in rate costs will become commonplace. 

Those injured in a motor vehicle collision in the State of California may find themselves dealing with minimum limits from the at-fault party. With California’s legal minimum automobile liability limits currently only $15,000 per person and $30,000 per incident, many of these injured parties have been stuck with these minimum limits even if they have medical bills exceeding them. SB1107 will increase the minimum legal automobile liability limits to $30,000 per person and $60,000 per incident in 2025. This limit increase will help California drivers receive fairer compensation for their tragic motor vehicle accidents. If you have been injured in a California motor vehicle accident, the highly qualified Sacramento car accident attorneys at Eason & Tambornini are ready to answer your questions regarding insurance and injury claims at no cost to you.