In most states, including Missouri, drivers must purchase an auto insurance policy that provides a minimum amount of bodily injury coverage.
For instance, Missouri drivers must buy a policy that covers at least $25,000 per person for bodily injuries sustained in a car accident, among other minimum requirements. However, with healthcare costs today, a measly $25k would cover just a couple of days in the hospital. Many other states also have similar bare-bones policy mandates.
However, some drivers choose to carry only this minimum $25k auto insurance coverage to save money on premiums. Or, according to Alex Hageli, director of auto-insurance policy for the Property Casualty Insurers Association of America, many drivers skirt these laws and refrain from purchasing any auto insurance at all in the hopes that they won’t get caught.
So why is this problematic?
If a driver is hit by another driver who is not insured or isn’t properly insured, the injured driver is not covered.
A case in point was recently highlighted in the Wall Street Journal. After running a stop sign, a driver in Oklahoma crashed into a couple’s Jeep. The couple sustained serious injuries and were both hospitalized. The total medical bills reached $550,000. But the couple found out that the at-fault driver didn’t carry any auto insurance to cover their expenses.
Due to this potential scenario, many drivers chose to purchase what’s known as uninsured / underinsured protection on their own policies. In the event drivers are in an auto accident with a driver who has limited or no auto insurance, this protection kicks in and they are covered.
Officials realize that drivers operating vehicles without insurance is a problem. According to the Insurance Research Council, approximately 14 percent of drivers on the roadways today drive without auto insurance. It seems the traditional fine simply isn’t enough of a deterrent to force people to procure adequate insurance coverage.
But there is hope for stricter regulation. Nationwide proactive measures are continuously being done. In fact, this past September, authorities in the state of Missouri along with 10 other states adopted a “no pay, no play” law that stipulates uninsured drivers injured by at-fault drivers can’t sue for pain and suffering as a penalty for refusing to acquire auto insurance.
The Insurance Research Council estimates that the program could reduce the number of uninsured motorists by about 1.6 percent-albeit a conservative estimate but still significant.
Other states are utilizing programs that take away license plates from vehicles that are found uninsured.
It remains to be seen whether the “no pay, no play” law will have any real impact on forcing drivers to abide by the law. For now, drivers are encouraged to purchase their own uninsured / underinsured coverage in the event of an accident.