(BPT) - The state of California has not raised auto liability coverage limits for more than 50 years, but that is set to change beginning next year. The new legislation, introduced in 2022 to keep pace with rising medical and repair costs, will require higher liability coverage limits for drivers and will take effect on Jan. 1, 2025. As we approach the new year, Mercury Insurance wants to help consumers better understand what these new limits entail.

"With the increase in liability coverage limits, California drivers will be more likely to have the coverage they need to pay for an accident without going into debt," said Justin Yoshizawa, Director of Product Management for Mercury Insurance. "However, some drivers may notice an increase in their premiums next year, which means now is a great time to get in touch with your insurance agent to review your policy and maximize savings with potential discounts."

Here's what California drivers should know about the mandate:

What are the new coverage limits?

Currently, California requires motorists to carry liability insurance with minimum limits of $15,000/$30,000 for Bodily Injury and $5,000 for Property Damage. Starting in 2025, this will increase to $30,000/$60,000 for Bodily Injury and $15,000 for Property Damage.

When will the new coverage limits take effect?

New liability coverage limits will go into effect on Jan. 1, 2025. Drivers who are impacted should see the change in their next policy renewal after that time.

Why is this change happening?

Despite being home to the most licensed drivers in the country, the state of California has not raised auto liability coverage limits for the past 56 years. During that time, the costs associated with getting into an accident - medical bills and repair costs - have risen significantly due to inflation. The changes are intended to provide California drivers with greater financial protection amid these rising costs if they were to get into an accident.

Will this affect insurance premium for drivers?

This will affect premiums for drivers who currently carry the minimum coverage and are bumped up to the new limits as a result of the mandate.

What do drivers need to do now?

No action is required on the part of drivers. All existing policies with lower limits will be renewed with the adjusted minimum limits on or after Jan. 1, 2025. However, it would be a good idea to reach out to your insurance agent to review coverages and potential discounts that may be offered.

"These new coverage limits will remain in place for the next 10 years, after which another increase will go into effect," said Yoshizawa. "The good news is that California drivers will be more adequately insured to cover repairs or injuries following an accident."