In California, a driver is only required to carry $15,000 in liability insurance coverage. That is the second lowest in the nation (only Florida is lower with $10,000). A car crash can cause well over $100,000 in medical expenses (not to mention lost wages). So if you are wondering why the amount is so ridiculously low, it is because the amount has not been raised in 40 years:
Enacted in 1974 when the average new car cost $4,440, California Vehicle Code 16056 dictated that drivers need to have insurance with $15,000 to cover bodily injury or death to one person in a motor vehicle accident, $30,000 to cover two or more people and $5,000 to cover property damage.
California is one of only seven states in the U.S. — the others are Arizona, Delaware, Louisiana, Nevada, New Jersey and Pennsylvania — with limits that low, according to the Property Casualty Insurers Association of America. Only Florida has lower minimums, at $10,000, $20,000 and $10,000, respectively. Alaska and Maine have the highest at $50,000, $100,000 and $25,000.
Adjusted for inflation, $15,000 in 1974 dollars is equivalent to $70,800 in today’s dollars.