There are so many benefits of having a policy that protects you against third party claims and pays own losses. It is unlikely that people contemplate driving without car insurance, if they can help it. And yet statistics show that about 14% of the US motorists don’t have any coverage. State authorities decide how they will try to discourage people from failing to comply with the minimum liability requirements and most of them would have severe punishments.
The range of penalties varies considerably between states. While some are very tough on breaking traffic laws the others may not have as forbidding level of fines. Check state insurance commissioner’s website for the rules and regulations in your area. Generally, they provide details of minimum required liability coverage, vehicle registration process and fines and penalties for forgoing the required policy.
Here is a list of penalties for driving without auto insurance. Licenses can be suspended for six to twelve months or revoked. Cars can be impounded until owners provide proof of coverage. There is a very good chance people will be taken to court so that they can explain themselves. Also, you would have to face hefty fines and cost of appearing in a court.
If you are involved in an accident while uninsured you may even get prosecuted in a criminal court. Furthermore, you would be responsible to pay the damages you caused to others in the accident out of pocket. This is one of the most important reasons for trying hard to get at least a liability only policy.
It is nearly impossible to predict the size of damages you may cause to third parties. You may be able to manage fines and other consequences but this one is very hard to handle. If you don’t have any money at the moment, you may have to pay it out of wages for years.
There could be injuries and death and you may hit an expensive automobile. You cannot expect them to dust off and forget about it. They will come after you with the full force of law. On top of everything else you may have to cough up their legal expenses as well.
Such drivers affect rates for everyone since someone has got to settle damages and injuries they inflicted. It they don’t have any coverage others have to claim on own policies. So, companies would be paying for losses caused by someone who hasn’t contributed to the system. The more people contribute to the premium pool the lighter the share of each participant.