What it is: Insurance Code §11629.7 establishes the low-cost program within CAARP for all California counties and apportions eligible persons among the insurers required to participate in CAARP, so participation is not a choice. Rates are set to cover the program's losses and expenses with no projected subsidy from other policyholders, and the premium varies by county.

Coverage and limits: §11629.71(a) sets liability limits of $10,000 per person and $20,000 per accident for bodily injury and $3,000 for property damage. These are below the Vehicle Code §16056 amounts, but §11629.8 says a low-cost policy satisfies the financial responsibility law anyway. The policy term is one year (§11629.71(d)). Uninsured motorist and $1,000 medical payments coverage are options. Under §11629.78(a), an insured may buy other types of auto coverage, such as collision, outside the program, but may not buy additional liability coverage; the required notice in §11629.75 says comprehensive and collision are only available outside the program and higher limits require a different policy.

Eligibility (§11629.73): - household income up to 250% of the federal poverty level - no at-fault accident causing bodily injury or death within three years - no felony or misdemeanor Vehicle Code conviction on the record - not more than one of either a principally at-fault property-damage-only accident or a point for a moving violation within three years, but not both A person with fewer than three years of driving history can qualify, with a surcharge under §11629.72(a).

Cancellation and renewal (§11629.77): an insurer may cancel only for nonpayment of premium, fraud or material misrepresentation, or buying liability coverage in violation of §11629.78. A substantial increase in the hazard, or no longer meeting the eligibility rules, is a ground for nonrenewal, not cancellation. Eligibility is recertified by CAARP after the first year and then every three years by the insurer that issued the policy.

Cost: §11629.72(b) requires an installment option of not more than 20% of the total policy cost at issue followed by seven other payments, and bars any other premium financing arrangement. Policyholders in one county may not subsidize those in another. Under §11629.76(c), no other fees may be charged, so the producer is paid only by commission.