Every state except New Hampshire requires drivers to carry automobile insurance, but this does not mean every driver does. According to the Insurance Information Institute, all states have a percentage of uninsured motorists among their drivers, from New Mexico’s high of 29 percent to Massachusetts’ low of 1 percent. To put teeth into the law, most states have imposed penalties for driving without insurance, as have many countries around the world.
Reasons
As unemployment rises, so does the rate of uninsured motorists. Most people who drive without insurance do so for financial reasons. In an economic crisis, more people can be expected to get rid of their insurance payments by getting rid of their car insurance. Other drivers believe that they do not need insurance because they have never had an accident. Still others cannot get insurance because of their past driving record or immigration status.
Monetary Penalties
Many states and foreign governments punish uninsured motorists by imposing fines. In the United States, fines can range as high as $5,000 for a repeat offender, with the specific dollar amount varying from state to state. According to the National Association of Insurance Commissioners, large fines for first-time offenders is the best way to enforce insurance requirements.
License or Registration Suspension
Many jurisdiction impose additional penalties for driving without insurance, including taking points from a driver’s license, suspending the driver’s license, suspending the uninsured’s vehicle registration and/or impounding the vehicle.
Jail
Some drivers can be jailed for repeatedly not carrying car insurance.
Driving without insurance can send you to jail. While no state mandates jail time for a first offense, many give the court the option of jail time for repeat offenders. However, while high fines were found to be an effective deterrent, jail time for noncompliance was not. This is probably because motorists do not believe that the penalty will be enforced.
Other Penalties
A relatively new penalty imposed on uninsured motorists is depriving them of the right to sue for noneconomic damages, such as pain and suffering. These so-called “no pay, no play” laws have been proposed in more than 20 states, and enacted in eight, according to the Property Casualty Insurers Association of America.
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