Calif. Low-Income Car Insurance Pilot Program Launches Tomorrow

A plan geared to reduce the number of uninsured motorists in Los Angeles and San Francisco will begin Saturday, with civic leaders nationwide watching closely to see if it might work in their communities.

The program, which lowers premiums for low-income drivers, will be headed by the California Automobile Assigned Risk Plan, a coalition of insurance companies. Participants in the program must have clean driving records and meet specific income guidelines to qualify.

The four-year pilot program charges $450 annually for minimal coverage in Los Angeles County and $410 in San Francisco. In addition, a 25 percent surcharge will be tacked on for male drivers between 19 and 25. While the policies satisfy the state’s minimum auto insurance requirements, they will not pay for policyholder injuries or vehicle damages regardless of who is at fault. But, by participating in the program, the drivers will be entitled to collect pain and suffering settlements if another driver is at fault.

A 1996 state law prohibits such actions for uninsured motorists. Policy benefits include $10,000 in liability, $20,000 for additional injured coverage and $3,000 for damages.