NU Online News Service, Oct. 1, 3:38 p.m. EDT
To keep uninsured drivers off the road at a time when premiums are unaffordable to some, California Governor Arnold Schwarzenegger this week signed into law the California Low Cost Automobile Insurance Program (CLCA) for low income, good drivers.
The CLCA provides affordable liability-only auto insurance that meets the state's financial responsibility laws, according to the California Department of Insurance.
It began as a pilot program in 2000 for residents of Los Angeles County and the City and the County of San Francisco only, the department said. The California legislature wanted to address the problem of uninsured motorists in the state, proposing the theory that most uninsured drivers in California go without liability insurance because of the cost.
In 2005, the California Legislature passed Senate Bill 20, which expanded the Program to the counties of Alameda, Fresno, Orange, Riverside, San Bernardino and San Diego, effective April 1, 2006. This legislation also authorized the Insurance Commissioner to launch the program throughout the state upon determination of need in each county, the department said.
In 2006 and 2007 the remaining counties were gradually added.
The program is administered by the California Automobile Assigned Risk Plan, and policies are written by California-licensed insurance companies.
The CLCA program is not subsidized by taxpayers, the department said. Rates are set and adjusted annually in each county so that the premiums collected are sufficient to cover losses and expenses in each county.
To be eligible, drivers must be 19 years old or older, have been continually licensed for at least three years, maintain a "good" driving record and have a household income that does not exceed 250 percent of the federal poverty level.
California Law requires that all drivers be insured.
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