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What Motivates So Many People to Drive Uninsured?
Jeff Ryan - CLU, ChFC, AIA, CIC, CPCU
November 2, 2022
It Is Not a Risk You Should Be Willing to Take
After over 25 years as a licensed insurance agent, I think the reasons for a person driving uninsured falls into a couple of categories:
- Sticking it to the man:
- Many people who are averse to the government telling them what they must buy. Enough said?
- Poor financial management:
- It is incredible to me the number of people who do not open their mail. Or, those who do not have a method for managing and paying their bills.
- More pressing financial priorities (The majority of uninsured may fall into this category)
- When the decision to pay for car insurance versus those things that carry more importance, perceived urgency, or consequence (food, heat, debt, drugs) gets paid first.
Number three (3) may be the most significant reason so many drivers become uninsured in the US.
The Insurance Information Institute website charts that the highest percentage of uninsured motorists are in Florida and Mississippi. The lowest number of uninsured motorists are in Maine and New York [1].
As a resident and insurance agent in New York, I can speak to the significant consequences one faces if your car is left uninsured.
Here’s what an uninsured driver has to deal with in New York if they let their car insurance lapse:
- [2] Civil Penalties of $8 to $12 per day for each day insurance is not in effect on the vehicle.
- Suspension of vehicle registration.
- Suspension of driver’s license.
- Inability to sell or transfer the title for the car.
An insurance lapse in New York comes with stiff fines, penalties, and consequences.
I know of many instances where people’s cars have been towed straight away from the side of the road after a citation by police when found they do not have proper insurance. Recovery of their impounded vehicle requires all fines and penalties be satisfied.
It doesn’t take long for citizens to learn that paying your auto insurance premium is not something you want to mess with. As a result, New York has some of the highest auto insurance compliance in the United States.
My guess is that uninsured drivers in Florida, Mississippi, New Mexico, Michigan, and Tennessee do not face the same kind of potential consequences.
This article may have been originally published at Quora.com.
To see Jeff's Quora.com profile click here.
“Am I covered if I drive someone else’s car?” Or, “Am I covered if someone else drives mine?”
Many don’t realize that the insurance industry is one of the country's most regulated business segments, especially in New York State. The New York State Department of Financial Services (NYS DFS) wields significant control over the insurance business and has a stated goal of protecting consumers.
Most property insurance companies offer Actual Cash Value or Replacement Cost settlement options. Typically, insurance companies will require that you insure the property to the settlement value you choose. If you select Actual Cash Value, the amount you may be required to insure the property for will be less than the corresponding Replacement Value.
In that spirit, the Ryan Agency is sponsoring a Stearns BBQ Dinner pickup at our office on 57 Broadway Mall in Hornell on September 12th from 3:00 PM to 4:30 PM.
Today, an individual’s credit history can play a more significant role than any one of those traditional factors. Good Credit Scores lead to a Positive Insurance score. A good Insurance Score greatly influences what someone will pay to insure their vehicles.
Insurance companies offer various discounts for which their policyholders may qualify.
Great Eight number Six (6) suggests taking a look at removing Comprehensive and Collision on Older Vehicles.
By reducing the number of claims in your insurance history, you can significantly affect your rates in the future.
Sometimes, this concept meets with resistance from policyholders. The thought of paying more in the event of a claim is off-putting to some. Even if that means I pay more for my insurance.
OK. Admittedly, this strategy doesn't benefit everyone, but it can be very beneficial for those it does. You may have unique home or auto insurance needs that prevent you from bundling with the same company. Alternatively… you might have a better rate without the bundle discount by splitting up your insurance between multiple carriers.
