Soon — on January 1, 2025 — a new law establishing updated California auto insurance policy minimum limits (for liability coverage) goes into effect. If you’re an attorney whose practice involves representing plaintiffs in auto accident litigation, then understanding these updated California auto insurance limits — and their potential impact on your firm’s strategic approach to accident litigation — is critical to growing your business.

Interested in growing your law firm’s client base? Here at Walker Advertising, we operate a number of popular legal sub-brands (such as Los Defensores and 1-800-THE-LAW2) through which we acquire inbound auto accident leads and other leads. Contact us today to speak to a member of our team about how we can help you access qualified leads that could turn into potential clients for your firm.

That being said, let’s get back to understanding the new California auto insurance limits. Keep reading to learn the basics!

What is the new California minimum liability coverage law?

California auto insurance limits (i.e., baseline liability insurance coverage for auto accidents) haven’t been adjusted for nearly six decades — in an effort to update protections to account for cost increases. As the price of medical care, car repairs, and other costs have gone up over time, an update to the insurance minimums was a critical priority to cover the now disproportionate losses sustained by injury victims.

The California Department of Insurance (CDI) oversees these regulations and ensures compliance with the new requirements.

So what is the new law?

Senate Bill 1107 — which goes into effect on January 1, 2025 — raises the auto insurance minimum limits for liability coverage to 30k/60k/15k (coverage for bodily injury affecting one person in the accident/coverage for bodily injury affecting two or more people in the accident/coverage for property damage in the accident). These changes are mandated by the California Insurance Code, which defines the minimum liability insurance coverage for vehicles. Do bear in mind that these increases also affect uninsured motorist coverage.

The California Vehicle Code also mandates electronic reporting of vehicle information and updates to auto insurance limits.

How will the new higher liability limits impact auto accident litigation for a plaintiffs’ lawyer?

Generally speaking, the new minimum insurance limits are likely to influence auto accident litigation for plaintiffs’ lawyers in the following ways:

• Increases the number of worthy-to-litigate claims, especially those involving bodily injury liability (i.e., higher volume of actionable leads)
• Potentially makes it easier to negotiate a favorable auto accident settlement, as the baseline minimum insurance payout is higher (by default), encouraging higher liability limits
• Insurance companies may be “stricter” about claim payouts, in an effort to counteract the profit loss from being forced to push up their minimum liability coverage
• And more

Ultimately, the most important impact of the higher liability limits is that legitimate auto accident claims will be more valuable (on average). This will not only make it more worthwhile to pursue a “prototypical” accident case, but will also have substantial knock-on effects for the legal marketing industry. Industry experts believe that — because minimums are going up and case values are going to increase across the board — firms are going to be more willing to spend more money to acquire an inbound lead. As online legal advertising becomes more competitive, the cost of advertising (and engage a funnel of inbound leads) is likely to increase as well.

“Working up” a car accident case — when is it economically justifiable?

Many law firms reject taking on edge cases — or even cases that are clear from a liability perspective, but that seem to be of low potential with regard to damages.

In cases where the potential damages include significant medical bills, it may be economically justifiable to work up the case.

Instead, they prefer to take on cases that lean towards one of two outcomes: 1) a simple, quick, and minimal payout, and 2) a more involved dispute with a somewhat clear liability picture, and a much higher potential for a payout.

Additionally, cases involving substantial property damage liability may warrant a more thorough investigation to maximize potential payouts.

Obviously, firms are not going to reject high-potential cases that they can resolve quickly and with minimal fuss.  That being said, these sorts of disputes are not common in the personal injury context.  There are many more cases that are certain, but wherein the payout is relatively minimal — the primary advantage being that they can be resolved quickly and with minimal fuss.

Firms that take on a large volume of low-potential, clear-liability claims are known as “churn firms.”  They have gained a bad reputation in the industry, as they’ve somewhat tarnished the general pubilc’s perception of attorney advocacy.  Because the cases they take on are low-potential, they have streamlined the intake-advocacy-execution pipeline to such a degree that they’re able to grow a firm business that operates on thin margins.  Rather than spend the time working up a case to its maximum potential, they would rather quickly resolve a claim and then acquire more “quick-resolution” clients — it’s an endless stream of incompetent, low-end advocacy.

When does “working up” a case make sense?  Well, most lawyers getting started with their career (or lawyers who are in a bit of a rut) could benefit from taking on cases that aren’t as straightforward.  The truth is that — as a growing firm — you should invest in all the cases that you handle.  Work up the claims of every client that you’re representing.  After all, you never know what you might discover about their case that could elevate it beyond what you initially thought.

Contact Walker Advertising for Helping Growing Your Firm’s Client Base

Whether you’re a solo lawyer, or are part of a larger firm with plans for expansion, it’s important to grow you client base in order to hit your revenue and client growth goals.  Here at Walker Advertising, we can help.  We operate a number of popular attorney networks — including our Los Defensores and 1-800-THE-LAW2 brands — through which firms are able to access leads for various legal claims.

The leads we acquire through our various online marketing efforts — from social media marketing to targeted web ads — have been pre-qualified by our team so that you aren’t hassled by a flood of leads that are simply not relevant or actionable for your purposes.  By gaining access to a high volume of quality leads, you’ll be well-equipped to select the best leads to grow your firm business.

Contact Walker Advertising today to connect to a member of our team who can explain how our legal networks can help your firm business thrive in this ever-changing digital marketing landscape.

We look forward to assisting you.