Topic 7 · Insurance and Financial Responsibility
The purpose of liability insurance is to:
- Pay for your own car repairs regardless of fault
- Pay for injuries or damages you cause to others — correct answer
- Replace your car with a new one every year
Why
Liability cover pays for the harm you cause to other people and their property. It does not repair your own vehicle. (Handbook, Section 10.)
Practise this in the real format
Reading one answer is not the same as sitting the test. The simulator runs the first-time adult form: 36 questions, 6 mistakes allowed, 83% to pass.
Source: California Driver's Handbook (DL 600, rev. 6/2025), the document the DMV writes the real test from. Edited by Fernando Aguilera. Aprobify is not affiliated with the California DMV.
More from Insurance and Financial Responsibility
- Which scenario will NOT result in suspension of your vehicle registration by DMV?
- What happens if you do not have insurance and are sued for accident damages?
- A fix-it ticket for no proof of insurance can be cleared if:
- Failing to exchange information after a minor accident, even if damage is under $1,000, is:
- Uninsured Motorist (UM) coverage in California covers:
- If you cannot afford liability insurance, California offers: