Texas May Actually Punish Uninsured Motorists (Finally)

As reported in today's Dallas Morning News, Texas may actually start getting serious about punishing uninsured motorists. Of course, I'll believe that when I see it happen.

For many years, it has been against the law to operate a motor vehicle in Texas without complying with the financial responsibility act — basically either showing proof of liability insurance or putting up a bond to be self-insured. But that law has never been vigorously prosecuted, and there has been no state-wide effort to identify uninsured motorists and get them off the road. Why? Because the auto insurance companies have always been opposed to mandatory insurance, and in Texas the insurance companies control the Legislature and the courts.

Auto insurance companies make high profits for the same reasons health insurance companies do — they insure only the cream of the crop, unless forced to do otherwise by law. So auto insurance companies are perfectly happy to insure only the people who are rich enough to easily afford insurance and who are responsible enough to buy it. As for the poor and/or irresponsible drivers, the carriers would much rather not be burdened by insuring them. Here are excerpts from the newspaper article:

Three years after the Legislature passed a law to crack down on uninsured motorists, the number of drivers caught without insurance coverage under the 2005 statute is exactly – zero.

Start-up of the new insurance verification program has been snagged by initial delays in hiring a private contractor to create a database, differences among state agencies responsible for implementing the law, worries that some data may be inaccurate and doubts about the program by the insurance industry.

The program, funded with an annual $1 fee paid by all Texas drivers when renewing their vehicle registration, aims to create a database for police officers, state troopers and vehicle inspection stations to instantly verify whether a motorist has the minimum coverage required under state law. The database would be set up with information provided by insurers.

An estimated one in five Texans drives without insurance, costing insured motorists an extra $1 billion a year for protection against uninsured drivers. State officials say they are aiming to launch a pilot program in June.

One group that lobbied for the law was MADD [Mothers Against Drunk Driving] of Texas, which argued that the average drunken driver is less likely to have insurance than other drivers.

"The need for this law has not changed in the past three years. In fact, it has probably gotten worse," said Bill Lewis of MADD-Texas. "There are probably more uninsured people today than when the law was passed."

Between 3 million and 4 million of the state's 16 million drivers are uninsured, according to state officials and the insurance industry.

"We have never supported any sort of compulsory auto insurance, particularly one open to inaccuracies when using a database," said Jerry Johns, president of Southwestern Insurance Information Service, an industry group.

"We will abide by the law and will certainly cooperate with the Texas Department of Insurance and other agencies involved. But we are concerned that if mistakes are made in the new system, it is the industry that will be blamed, and that's not the way it should be."

Although Texas has had a financial responsibility law requiring drivers to buy insurance for several years, enforcement has been difficult even though proof of insurance must be furnished to get a license renewal or safety inspection.

Millions of motorists skirt the law by using counterfeit proof-of-insurance cards or by obtaining a month's coverage of insurance to get an ID card, only to cancel the policy once they get their licenses renewed or their vehicles inspected.

Under the state program, a driver pulled over for a traffic violation or involved in an accident will still be asked to produce proof of insurance. But the officer also will run the license plate of the vehicle through the insurance database to determine whether the driver has insurance.

The state also will contact drivers without insurance by mail, warning them of the consequences for not having an insurance policy.