Increase in numbers of uninsured drivers predicted


One side effect of the worsening economy? Experts predict that there will be more and more uninsured motorists on the road. A recent study (PDF) from the Insurance Research Council (IRC) says that within the next year, we can expect that approximately one in six drivers across the country may be driving uninsured. The report found a strong correlation between the percent of uninsured motorists and the unemployment rate: “An increase in the unemployment rate of one percentage point is associated with an increase in the uninsured motorist rate of more than three-quarters of a percentage point. Based on current unemployment rate projections, the percentage of uninsured motorists is expected to rise from 13.8 in 2007 to 16.1 in 2010.”
Depending on which state you live in, the problem may be more or less severe. The five states with the highest uninsured driver rates in 2007 were:

  • 29% – Mexico
  • 28% – Mississippi
  • 26% – Alabama
  • 24% – Oklahoma
  • 23% – Florida

The five states with the lowest uninsured driver rates in 2007 were:

  • 1% – Massachusetts
  • 4% – Maine
  • 5% – North Dakota
  • 5% – New York
  • 6% – Vermont

Page 3 of this report from the IRC includes a chart depicting the percentage of uninsured drivers in your state. (PDF)
Paying the price
Driving uninsured can be costly. It’s against the law to drive without liability insurance in all states but Wisconsin and New Hampshire, which both require drivers to have what is in effect self-insurance, or proof they can pay a minimum level of damages. Penalties for driving uninsured may include fines, license or registration suspension, impounded vehicles, and the potential for imprisonment. For example, here in Massachusetts, penalties for driving without insurance can include a fine of between $500.00 $5000, up to 1 year in jail, or both. Your license can also be suspended. FindLaw offers links to state laws for driving without insurance or with insufficient insurance.
Check your own coverage
In good economies and bad, the cost of an accident with an uninsured driver can be steep. IRC estimates the average payment on claims in crashes with an uninsured driver is about $11,000. Your chances for recovery will depend on your own coverage and/or the financial assets of the uninsured – which may be poor, given that is the most likely reason for not having insurance in the first place. It’s a good idea to evaluate your coverage level with your independent agent to ensure that you have adequate coverage. If you don’t already have it, you may want inquire about uninsured and under insured motorist coverage. These types of coverage would pay for injures or damages if you are in an accident with an uninsured or under insured motorist or if you are the victim of a hit-and-run accident.