Calif. Considering Expanding Low-Cost Auto Program Statewide

August 30, 2007

California Insurance Commissioner Steve Poizner has announced plans to complete his expansion of the California Low Cost Automobile Insurance Program (CLCA) to the entire state. Commissioner Poizner is working to make the program available to residents in the final 16 California counties – Alpine, Colusa, Del Norte, Glenn, Inyo, Lassen, Mariposa, Modoc, Mono, Nevada, Plumas, San Luis Obispo, Sierra, Siskiyou, Tehama and Trinity, the Department of Insurance announced. The affordable program provides eligible low-income, good drivers with state-required liability coverage for under $400 a year.

Senate Bill 20 (Escutia) authorized the Commissioner to launch the program throughout the state upon his determination of need in each county, based on statistical data analysis and local community input.

“Based on a review by my department, I have initially determined the need for this program in these sixteen counties,” Poizner said. “I plan to hold town hall meetings in each of these communities in September and October to directly gauge their insurance needs.”

The program had sold 34,161 policies since its inception. The program is administered by the California Automobile Assigned Risk Plan and the policies are issued by California licensed insurance companies. The program is not subsidized by government funding. Rates are set in each county so that premiums are sufficient to cover losses and expenses in each county.

The California Low Cost Automobile Insurance Program initially began in 1999 as a pilot program in Los Angeles and San Francisco. A new law, SB 20, later authorized the Commissioner to launch the program throughout the state upon his determination of need in each county. Beginning in April 2006, the department began expanding the program statewide.

Source: CDI

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