PLCaliforniamedium
A California producer is binding a new private passenger auto policy with 100/300 BI limits. The named insured says she 'doesn't need' uninsured motorist coverage. Which step is REQUIRED under Cal. Ins. Code § 11580.2 to lawfully issue the policy without UM/UIM coverage?
The insurer must offer UM/UIM at equal 100/300 limits and obtain a signed written rejection from the named insured
BThe insurer may simply omit UM/UIM from the policy because California treats it as optional
CThe insurer may rely on a verbal rejection so long as the producer documents the call in writing
DThe insurer must offer UM/UIM at the 30/60 statutory minimum only and obtain a written rejection at that minimum level
Why this is the answer
Cal. Ins. Code § 11580.2 requires every auto liability policy to include UM/UIM coverage at limits equal to the BI limits selected by the insured UNLESS the named insured rejects the coverage (or selects lower limits, no less than 30/60) in writing. A verbal rejection does not satisfy the statute and exposes the carrier to reformation: courts and the CDI have repeatedly held that absent a compliant written rejection, the policy is read as carrying UM/UIM at the BI limits. The offer must be at EQUAL limits (here 100/300), not at the 30/60 statutory floor.
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