The Importance of Financial Responsibility



The Importance of Financial Responsibility: Uninsured and Underinsured Motorists


Whether you just purchased a new car, switched insurance providers, or are wondering where to start on your coverage research, it is important to note the following:

  • In the State of California, liability insurance is required
  • California’s mandatory insurance law is formally known as “financial responsibility” law
  • If you are injured in an auto accident where the fault is on another vehicle without liability insurance, Uninsured and Underinsured (UM and UIM) coverage will protect you
  • The minimum liability insurance requirements set by the California Department of Motor Vehicles is $15,000 per person
  • Choose the highest policy limits you can afford when comparing UM and UIM coverage
  • Not all umbrella policies provide UM and UIM coverage so be sure to read all of the policy details carefully
  • In addition to motorists, UM and UIM coverage is important for bicyclists and pedestrians as they are also at risk
  • Be sure to review your policy with an insurance agent

Uninsured motorist coverage and underinsured motorist coverage are not the same thing. Uninsured motorist coverage protects you if- when involved in an auto accident- the driver found to be at fault does not carry liability insurance. Underinsured motorist coverage differs from uninsured motorist coverage as kicks in when the at-fault driver’s liability limits are not enough to cover medical expenses or property damage.

Many drivers do not carry liability insurance so it is important to protect yourself in the event that you are involved in an auto accident. Protect yourself by purchasing a large uninsured/Underinsured Motorist coverage on your auto policy. We suggest a minimum of 250,000/500,00 for most Families with Household Income of over $75,000.

If you can afford to do so, also consider purchasing a personal umbrella which provides 1 Million additional coverage. A personal umbrella is not the same as a normal umbrella policy which does not provide UM or UIM coverage.


Hello! I’m Ed Smith, a Vacaville Auto Accident Attorney.  I’ve been helping the residents of Vacaville with their auto accident and personal injury cases for the past thirty years.

Have you or someone you love been seriously injured in a car accident due to the negligence of someone else?

If so, call me right away at (800) 404-5400  for free, friendly advice.

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Image Attribution: By Terrence McNally from Arcata California, USA (Boyd3  Uploaded by Gary Dee) [CC BY 2.0 (], via Wikimedia Commons

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