What Are the Penalties for Driving With No Car Insurance?

According to a study from the (IRC), one in six people driving on the roads does not have car insurance. The researchers noticed a powerful connection between the nation’s unemployment rate. The number of motorists driving without insurance (which is not surprising) however, many other reasons also exist. Some drivers have even simplified the reasoning for not having car insurance to whether or not a vehicle is worth more than the cost of six months’ worth of coverage.

The ticket fine for driving without insurance was previously minimal in most states (around $200) but the penalties. Today ticket fines are much higher with almost all states moving towards a combination of fines and vehicle registration suspension for violators. However, the risk of driving with no car insurance is the potential personal liability you become exposed too in the event of an accident. Even a minor car accident can cost $5,000 or more in damages. If anybody is injured in a car accident, you may want to stop by a bankruptcy lawyer’s office at lunchtime.

Many drivers decide to take their chances of driving with no car insurance. The fact is you are gambling with your life and your financial future by not having car insurance in place.

“Almost 20% – 1 in 6 drivers DO NOT have car insurance”

Car Insurance Requirements
Each state has a legally required minimum insurance that drivers must carry. The minimum requirement is for liability coverage only. Any damage a driver causes to another person or his property is covered up to the limits of the liability policy. This just three numbers 15/30/10, are the monetary limits of liability insurance. What this means is, if someone causes an accident, his insurance will cover $15,000 of medical bills. For one person he injures in that accident, or up to $30,000 total for all injuries resulting from that one accident.

Considering the current cost of medical care, one visit to an emergency room can cost almost $10,000 for a person with no health insurance. This shows the minimum liability coverage does not go very far if a person causes serious injuries to another driver. Additionally, $10,000 is the last of the three numbers quoted, which represents coverage for any property damage caused by the at-fault driver. Again, considering that many cars, especially newer models, cost at least twice that, the $10,000 liability coverage seems slightly inadequate.

Drivers who cause an accident and do not have insurance at all, or only have a low level of coverage, are liable for any costs that exceed the amount of their insurance limits. If you fall into bankruptcy, you likely have to sell everything to pay for the costs of an accident.

Uninsured Motorist Coverage

Several insurance companies provide a kind of policy to protect drivers against uninsured or underinsured motorists. This type of insurance only covers medical costs. So any property damage would have to be covered by collision insurance or be paid for by the uninsured person who caused the accident. Uninsured/underinsured motorist coverage does not pay anything for injury or damage sustained by the uninsured motorist who is at fault; it only covers the policyholder.

Why Drive without It?

The logic that uninsured drivers use to make sense to them, but the damages caused to other drivers and their vehicles are not just the responsibility of those people. The more drivers causing accidents without insurance, the higher insurance costs rise for everyone. In some states, like Texas, this type of insurance “freeloading” is actively addressed.

If a driver does not have insurance in Texas, police will tow the person’s car after they receive one warning. Drivers will need to pay a minimum of $100 in impound fees to get their vehicle back. Legislators in Texas are becoming more aggressive and trying to remove the warning for a first offense. Law enforcement would develop systems to manage all of the impounded cars, which would be a substantial number since approximately 20% of drivers in Texas do not have insurance. With these drivers off the road, insurance costs would come down for everyone.

Penalties for driving with no car insurance

Penalties for uninsured drivers vary from one state to another. If you have not car insurance and you still show a desire to drive anyway, your vehicle registration can be suspended and your car impounded. Some states also fine drivers who choose to drive with no insurance, or continue driving even when they cannot maintain auto insurance.

Fines may range from $150 to $500; this does not factor in persons who drive without insurance and get into an accident. Aside from having to pay out of pocket for any injuries or damage while a driver cause, there is a perfect chance the person will have to carry SR-22 insurance for the next three years.

In the state of Michigan, fines have been raised recently for drivers who are caught without insurance. For drivers without auto insurance, the state will issue a license suspension who cannot come up with any proof that they have an active auto insurance policy, within 30 days.

Many other states are becoming fed up with laws that allow an uninsured motorist to pay a ticket and get back on the road while continuing to drive uninsured. In Oklahoma, Sen. Patrick Anderson is pushing a new law for any uninsured motorist caught driving. Police officers will tow the driver’s car immediately, and rather than the driver being able to pick the car up at an impound lot and pay a fine. The driver will need to go in front of the judge.

Once in front of the judge, the police officer can request the car be seized. If the car’s owner shows up to court and provides proof of insurance, he receives his car back. In case you do not show, automatically your car become property of the state, to be sold at auction and the proceeds sent to the state. If this law passes, it will give quite a bit of power to local policemen. They could potentially abuse the discretion to seize cars from some uninsured individuals and not others. Whether this specific bill passes into law or not, it shows that the states are getting much more serious about uninsured drivers and are actively seeking harsher penalties.

Finding Cheap Insurance

The main reason many drivers do not have auto insurance is the expense. The easiest way to find affordable insurance is to get quotes from several different insurance providers. Every insurance company uses a different formula to determine insurance rates. It is worth spending the time to check with several companies since the prices could vary quite a bit. Additionally, certain companies specialize in writing insurance for drivers with points, accidents, or a DUI on their driving record, and have surprisingly affordable insurance rates. Always check all over and evaluate auto insurance corporations.