Very often when a client comes to see me, what they’re primarily concerned with is how much automobile insurance is owned by the person who caused the accident they were in. But I like to counsel people–when I can–on (for their own future needs) how much automobile insurance they should be carrying.

Under California law, you must have automobile insurance and there are severe penalties for not having it. The minimum limits are $15,000 per person, $30,000 per accident. For 99% of all people, this is not a sufficient amount of insurance. One general rule, both in terms of protecting yourself and protecting people you might injure is that you want to carry insurance that is double the amount of your own personal assets. For instance, let’s say you’re a wealthy person and you own a million dollar home, you really should have no less that $2 million in liability insurance. Otherwise, your home could be at risk if somebody is badly injured. And, also you’re going to want to see that person protected.

In general I’d say if you can afford nothing like that, that a good minimum is $100k per person, $300k per accident. Of course it depends on your own economics, but in general buy as much insurance as you can afford to protect yourself and others.