Posted on Thursday, March 10, 2016
Did you know that there are 38 states better than Indiana at getting their drivers to carry auto insurance? 16% of Indiana drivers are currently without insurance, making it the 12th worst state in the US. What does this mean for the rest of the 84% of Indiana drivers, and what is the state government doing about it?
First, uninsured motorists can affect insured drivers in many ways. Perhaps the most obvious way is in making people with insurance carry uninsured and underinsured motorist coverage. This UM/UIM coverage basically means that you are buying an insurance policy for a driver that currently doesn’t have insurance. So if you get in a wreck with a driver that doesn’t have insurance, doesn’t have enough insurance, or is a hit-and-run, your UM/UIM insurance will pay for the damages up to your policy limits. But what happens if the victim in a wreck doesn’t have auto insurance?
Previously, the victims could still collect all types of damages, which included something called non-compensatory damages. These damages could include things like pain and suffering, which in court could be awarded to a victim in very high amounts, for example $1 million. The incentive for an uninsured driver to try to collect these damages was very high, especially because in the past courts tended to side with the victims of auto accidents, regardless of their insurance policy.
Last year, the Indiana state legislature changed this under a program known as “No Pay, No Play”. Now, a driver without insurance that is a victim will only be able to collect on all types of damages the first time an accident happens. If a second accident happens to the victim, and that person still does not have auto insurance, that person will only be able to collect on medical bills, and will not be able to “get rich” on pain and suffering claims.
The second change is stiffer penalties for uninsured drivers. Indiana has more than doubled the fines for 1st, 2nd, and 3rd offenses. The 90-day license suspension remains in place for each offense, but now there is something even greater. On the 2nd and 3rd offense, the vehicle’s license plate will be surrendered and the registration will be suspended, for 90 days on the 2nd offence and 180 days for the 3rd offense. Not having a license plate on an uninsured car is sure to make a big impact in the amount of uninsured motorists on the roads, because that will really stand out and make it easier for law enforcement to catch them.
With these changes, the state of Indiana is making good progress in cracking down on uninsured motorists, ensuring that the vast majority of law-abiding citizens have to pay as little as possible for UM/UIM claims. If you know of anyone currently driving without insurance, please tell them about these important updates. It is critically important to carry auto insurance, and by working with your local agent, you can be sure that you are getting the best coverage at the lowest possible price.