California pilots new auto insurance program

With the turn of the year a new law come into effect in California enabling low-income East Bay residents to buy driver's auto insurance for less then $400 which makes it a pioneering State in that area. The rule is to come into effect April 1 2006 - no April fool's joke :-)

Until now this leading auto insurance program has been limited to San Francisco and Los Angeles county residents. But in April it will expand to include Alarmeda, Fresno, Orange, Riverside, San Beranardino and San Diego counties. If all goes well, it might expand to embrace the rest of California soon after.

To qualify for this insurance discount, a driver needs to be over 19 years old and have income within 250 percent of the statutory poverty line - that being about $23,000 for singles and $47,000 for families of four. Other qualifying requirements include holding licence for at least three consecutive years, no more then one at-fault accident involving bodily injury or death in the past three years or more than one moving violation in three years, or more than
one property-damage wreck that they caused driving within the same time span.

The program, is administered by the California Automobile Assigned Risk Plan and has provided car insurance for low-income San Franciscans at a rate of $314 per year. In Los Angeles, the cost has been $347.

This auto insurance expansion bill has been passed by the Senate on a 21-13 vote and went through the Assembly with a 62-17 margin.