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Disturbing Uninsured Motorist Trends


One of the more unsettling trends noticed during the recent economic downturn is a large number of Americans dropping their car insurance policies. More and more people are trying to save a little money by reducing their bills, but they may not realize that dropping their car insurance could actually be more expensive in the end.

Driving without insurance is illegal in almost all of the 50 states. If you are involved in an injury accident and you are not insured, you could face a high dollar lawsuit from the other driver. Allowing your car insurance to lapse for even a short period will cause your rates to be almost twice as much when you do purchase an insurance policy again. It is better to reduce your coverage as much as you can afford than to open yourself up to the consequences of driving without insurance. The smaller annual insurance bills are far less than the potential cost of covering an accident without any protection.

Uninsured Numbers Rise as Economy Weakens

Research studies show that the number of uninsured motorists in the United States rose sharply as the economy worsened. The uninsured motorist numbers also rose as unemployment rates rose over the last five years. In 2009 the numbers stopped rising as sharply, but they did not drop noticeably. Right now, drivers in most of the United States face at least a 10% chance of running into someone who is driving without insurance. The states hit hardest by the recession show the highest number of uninsured motorists in the most recent study.

The study shows that the states with the most uninsured drivers are in the Southern and Midwestern regions. Mississippi and New Mexico have the highest rates, at 28% and 26%. Tennessee, Oklahoma, Florida, and Alabama were not far behind with 24% of the drivers on their roads listed as uninsured.

One reason for these high rates may be the fact that these states are not equipped with public transportation systems that you find in the Eastern states. The Northeastern region had the best record for uninsured motorists, with states like Maine and Massachusetts reporting as few as 4% of their drivers going uninsured. States with dense populations, like California and New York, reported uninsured motorist rates of around 15%.

Drivers Could Face Higher Costs and Legal Battles

It may seem like a good idea to drop your car insurance for a few months if you lose your job or find your income suddenly reduced. There is a chance that you won't be involved in a car accident while you are uninsured, so you would be saving money without any consequences, right? The trouble is, cutting your insurance today will make it more expensive to find a policy in the future. Some insurance companies will not accept customers who have experienced a lapse in coverage.

If you do have the bad luck of being involved in a car accident while you are uninsured, things could become very expensive. The first problem will be trying to repair or replace your own car without insurance. The next problem will be your responsibility to reimburse the other driver for damages and injuries if the accident is your fault.

You will also face the legal consequences of driving uninsured if your state requires a minimum amount of insurance. Being uninsured doesn't mean you are off the hook for paying reparation to the other driver. It is possible for that driver to sue you, which could lead to your wages being garnished or other unpleasant losses.

Some States Imposing Stricter Consequences for Driving Uninsured

The states that require all drivers to carry car insurance have begun to crack down on uninsured drivers. Places like Texas and Wyoming are raising the fines for driving without proof of insurance. Texas has implemented a policy that punishes drivers severely after their second offense. Fines can be as steep as $1,000, and the state could suspend your driver's license. Repeat offenders could face a $250 annual penalty that allows them to keep their driver's licenses for the 3 years after they are caught driving without an insurance policy.

Even drivers who are extremely careful and tend to avoid accidents can be caught driving without insurance. Many states have begun to set up checkpoints on main roads where the officers will ask each driver for proof of insurance. You can also be caught driving without insurance if you live in a state where proof of insurance is necessary to renew your tags. An out of date tag is an easy way for police officers to target drivers who might be uninsured. Driving with an expired registration carries its own harsh penalties, as well.

Insured Drivers Paying More Due to Uninsured Motorists

When the number of uninsured drivers rises, the overall insurance rates rise for everyone who is still carrying a policy. The insurance companies need to raise their rates so that they can be prepared for the higher risk of paying out uninsured motorist benefits if their customers are involved in an accident with someone who is not insured. Someone who carries the right amount of insurance will have to face rising rates because their insurance company would have to pay out a larger settlement if the person found at fault in an accident is someone who does not have their own insurance policy.

Uninsured drivers are creating more trouble for themselves and for other drivers when they choose to allow their insurance policies to lapse. Hundreds of thousands of dollars are paid out each year for settlements involving uninsured motorists, and that amount will continue to rise as the number of uninsured drivers rises.

The only time anyone should drop their car insurance coverage is when planning to get rid of the car altogether. Talk with your insurance agent and compare rates online if you need to cut back on how much you spend for your insurance coverage. It is less expensive to stay insured than it is to drop your coverage completely.