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More than 29 Million Drivers Remain Uninsured in the US

Posted on Mar 9, 2016 by in Uninsured Drivers | 0 comments

If you are a car driver in the US and you are to renew your car registration or driver’s license, or if ever you get involved in an accident or get pulled over by a traffic enforcer, one important document that will be asked of you, and which you will need to show, is proof that you have auto liability insurance.

Auto liability insurance is one way through which you can comply with the financial responsibility law, a law that requires drivers in the US to demonstrate their financial capability to pay for damages resulting from an accident wherein they are at fault. This law does not specifically mandate the carrying of auto insurance, just the capability to pay compensatory damages. For this reason, alternative options are available for drivers in the states of Virginia and New Hampshire (which happens to be the only state that does not mandate the carrying of auto liability insurance on drivers).

In the state of Virginia, drivers may choose to register their car as uninsured, but only after depositing cash or securities with their state’s Department of Motor Vehicles (DMV). In New Hampshire, drivers may purchase an auto liability policy if they choose to do so, however, to be able to comply with this state’s Motor Vehicle Financial Responsibility requirements, it is enough for drivers to deposit cash or post a bond with the state. (There are certain instances when the state may require a driver to purchase and maintain auto insurance for some time. This is the case when a driver is cited for the reckless operation of a motor vehicle for a second and subsequent times, is he/she is found guilty of leaving the scene of an accident, if he/she is convicted of vehicular homicide, DUI or DWI or certain types of motor vehicle-related violations.)

In all other 48 states, carrying of auto liability insurance is a mandate, and the type of auto insurance that drivers need to carry depends on the type of insurance system that is recognized by their state: the “tort” or in a “no-fault” insurance system.

Under the tort system (38 states are currently under this), there is always someone held accountable for the accident (for drivers who wish to carry auto insurance in Virginia and New Hampshire, this is the available insurance coverage for them). The victim in an accident has the option to file a civil lawsuit against the liable party and claim compensation from the liable party’s insurance provider. The “no-fault” system, however, eliminates the need to file any lawsuit since compensation will be paid by the respective insurance providers of the drivers involved in the accident. Twelve states actually recognize this system: Florida, Hawaii, Kansas, Massachusetts, Michigan, Minnesota, New York, North Dakota, Utah, Pennsylvania, New Jersey and Kentucky; the last three, however, allow drivers to choose either the tort liability car insurance or the no-fault liability car insurance.

Despite the mandate, more than 29 million drivers, according to the Insurance Research Council (IRC), remain uninsured. Many of these drivers find insurance premiums just too costly for them to keep on paying. Independent car insurance companies tell drivers, however, to use auto insurance quotes to compare prices; besides being free, these quotes are also sure to help drivers find the best deal based on their specific needs and budget.

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