Louisiana Law to Increase Fees for Uninsured Drivers Next Month

Louisiana drivers will soon face stiffer penalties for driving without car insurance after Gov. Bobby Jindal signed Act 641 into law on Thursday.

Starting July 1, owners of uninsured cars will have their cars impounded and their license plates and registration revoked. The new law also increases the reinstatement fee for these items and establishes a separate minimum $75 fine for driving uninsured.

The following table compares the old and new reinstatement fees, which are based on the length of time the car was uninsured:

Period that car was uninsured

New reinstatement fee
(effective July 1)

Previous fee

1-30 days

$100

$25

31-90 days

$250

$100

91 days or more

$500

$200

According to a legislative fiscal report, the new fees set under the law are expected to raise $53 million in additional revenue.

$53M in Revenue to Go to Verification System, Public Safety Salaries

Part of Act 641 uses the fee hike to fund an auto insurance verification system.

The system will use a database containing information about Louisiana auto insurance policies and drivers. It will allow authorities to check whether drivers have auto policies and verify whether or not they have had lapses in coverage. The system will contain “real-time”  data for police to reference during traffic stops.

Some of the increased fees that are collected will go to an “Insurance Verification System Fund” that would back the “creation and maintenance” of such a database.

Uninsured motorists have faced clampdowns in other states with similar databases, including Maryland, Texas, Montana, and Rhode Island.

Other parts of the fee hikes are marked to increase law enforcement and public safety salaries and programs.

About Charles Nguyen
Charles Nguyen is an enterprising journalist who reported for Patch.com and the Desert Dispatch and was the editor in chief of the Guardian (the twice-weekly newspaper at the University of California, San Diego) before coming to Online Auto Insurance News.

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