Auto insurance in California or any other state is just one of many types of insurance that is available to the average person today. Like most types of insurance you take out a policy on a certain item, in this case an automobile, and pay a premiums every month of a certain amount. The policy that you have taken out determines what incidents your car is protected against. It can be protected against, theft, damage, accidents, or many other incidents that are likely to happen to any car that is taken out on the road on a regular basis. If one of these incidents does occur then the insurance will pay out a certain amount that was determined when the policy was signed. This amount is then used towards replacing the car or repairing the car in case of damages. Some policies even protect you if you caused damage to another person's car and will pay the costs for the other person's repairs.

In many states across the country people are legally bound to protect their car with auto insurance. California or other state legislation determines the amount of cover that you need to take out on your car for your automobile to be a legal vehicle on the road. Generally the minimal amount of insurance is more than enough but some states have very strict codes and legislation concerning the insurance that you need on your car. Usually a dealer cannot hand over the keys to a car that you have just purchased if you do not have auto insurance on it. While some people may rail against legislation such as these it is there to protect you as much as it is there to protect the other users on the road.