Sacramento– Withering before insurance industry opposition, an attempt to create the nation’s first low-cost policy for low-income drivers has been transformed into an experimental project for two counties.
Those counties would be Los Angeles and San Francisco.
The joint effort by Democratic Sens. Jackie Speier of Daly City and Richard Polanco of Los Angeles, originally intended as a statewide program, was scaled back during three days of hearings in a two-house legislative conference committee this week.
The amended plan, which is expected to go to the floors of the Assembly and Senate next week, would set up a two-year project to provide bare-bones coverage for low-income drivers in the two counties, which contain roughly 40 percent of California’s uninsured drivers.
To qualify, a motorist would have to earn no more than 150 percent of the government-defined poverty level, or about $ 20,000 a year for a family of three and $ 30,000 for a family of five.
In Los Angeles County, the policies would cost $ 400 a year to those whose qualify, with a 25 percent surcharge added for young drivers between 19 and 25. In San Francisco, the policy would cost about $ 365, plus the surcharge.
Current California law requires motorists to carry automobile insurance. Of the state’s 20.2 million motorists, roughly a fourth haven’t purchased coverage.
The state requires a driver’s policy to provide coverage or at least $ 15,000 for the driver’s medical bills, or up to $ 30,000 for the injuries all those in the car and $ 5,000 for property damage. The low-cost coverage would be reduced to $ 10,000, $20,000 and $ 3,000, respectively.
The average California driver spends about $750 annually on auto insurance.
The principal backer of the low-income policies, the Foundation for Taxpayer and Consumer Rights, said the amended proposal represented “half a loaf.”
“It will be the nation’s first truly low-cost policy for low-income drivers and it will serve a segment of the neediest population,” said foundation spokesman Doug Heller.