California auto insurance rates now based on driving record, not ZIP code

Until recently, getting cheap California auto insurance had little to do with your actual driving record and a lot to do with where you live. Sound unfair? California lawmakers agree.

In 1988 Proposition 103 was proposed to make California auto insurance rates based on your driving record, not your zip code. 18 years later, in 2006, Proposition 103 was passed. Insurers had two years to switch over to the new pricing system. Most took their sweet time. But the final deadline for the switchover was on July 14, 2008. Now, all California auto insurance companies must price your premiums based on your driving record.

The problem with the old method of pricing insurance premiums in California is clear. You could be a perfect driver living in a “high risk” zip code in souther California and paying more for your auto insurance that a driver who caused accidents in another zip code in northern California.

The new changes mean finding cheap California auto insurance has a lot more to do with your driving record than your location. Too bad it took 20 years for the Proposition to pass. But better late than never.