Montana Senator Gebhardt: How Much Are Uninsured Drivers Costing Us?

By Mike Anderson Posted in Car Insurance News



Ailing Economy

One of the negative side effects of the downturn in the economy is the inability of many Americans to purchase car insurance. A recent study conducted by the Insurance Research Council showed that by 2010 as many as one in six drivers will not have car insurance. Five states with the highest uninsured motorist rates are  29% in New Mexico, 28% in Mississippi, 26% in Alabama, 24% in Oklahoma, and 23% in Florida. Massachusetts had the lowest uninsured motorist rate at 1%.  To many who are struggling to scrape by and put food on the table, car insurance may be a non-necessity. Even with state requirements of minimum liability coverage, many are finding it difficult to find the money to buy it.

What Is The Government Doing About It

Recently, Montana Senator Gebhardt spearheaded an initiative to look into the growing trend of uninsured drivers and find a practical solution. On average uninsured drivers cost Americans $4.8 billion dollars a year in damages. The initiative Gebhardt has proposed would aim to study the affects of uninsured drivers and find plausible solutions to the car insurance crisis.

What Are The Effects Of Uninsured Drivers

What exactly happens when you’re in an accident with an uninsured driver? Many wonder how uninsured drivers can affect our economy, essentially it is a trickle-up effect. At the bottom are the insured and uninsured drivers. If you are involved in an accident with an uninsured motorist and they are at fault, then you would be responsible for all repair expenses and medical expenses. You could file a lawsuit against the other driver but the chances of getting any money from them are slim to none since most uninsured drivers can’t afford to purchase insurance.

If the accident was severe enough, then you could go bankrupt paying for the expenses that your car insurance doesn’t pay for. In turn, your insurance company will usually raise your insurance premiums to absorb the cost of paying for your accident. This is assuming you have more than just liability coverage on your car. If you only have liability, then you will receive no money from your insurance company.

With one out of every four drivers, in some states, driving without insurance there are many accidents involving uninsured drivers. The negative effect on the car insurance industry as a whole is an increase in premiums across the board, which in turn has a huge impact on the average American’s ability to afford insurance. It is a vicious cycle that needs legislative action to be broken.

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