Miss. Reps Push for Auto Insurance Verification System [Updated]

Photo of Rep. Gary Chism

Rep. Gary Chism, principal author of the proposed legislation

A group of Mississippi state representatives, led by an independent insurance agent, is aiming to chip away at the state’s uninsured motorist problem by introducing legislation to establish an electronic car insurance verification system.

But a series of amendments passed by lawmakers have removed some of the bill’s provisions that would have allowed the state to take a more active approach toward catching uninsured motorists.

Representatives voted on Wednesday to ditch parts of the bill that would have established random checks in which the state would issue written inquiries about insurance status to residents believed to be driving uninsured. If the inquiries receive no response, registration would have been suspended.

Other deleted provisions would have made it harder for drivers to get behind the wheel without coverage. One now-deleted part would have required drivers to show proof of auto insurance before being able to obtain license tags.

But the heart of the bill–the verification system–still remains intact.

The system would be similar to those in place or taking shape in about 30 other states. Insurers would electronically submit their policyholder information to the database, which would be accessible to the Department of Insurance and other authorized entities.

One of those entities authorized to access the data would be law enforcement offices throughout the state.

If the system gets approved an implemented, police would be able to have remote access to the database. So when residents are pulled over for regular traffic violations, officers could access the database to find out if they have proper coverage in place.

Police would not be able to pull drivers over simply because they suspect that a motorist lacks coverage.

Mississippi’s uninsured motorist rate is considered to be one of the highest in the nation. In an analysis of bodily injury and uninsured motorist claims data, the Insurance Research Council estimated that, in 2007, about 28 percent of the state’s drivers lacked basic, state-required liability car insurance. Mississippi was second only to New Mexico, which was estimated to have a rate of 29 percent.

And the problem may be even worse now. This is because the uninsured rate is closely tied to the rate of unemployment, which was almost twice as high in the state in 2010 as it was in 2007 when the 28-percent estimate was made.

The bill, which was written by State Rep. Gary Chism, says that the system should be set up no later than June of next year and would have an at least six-month testing period.

A similar system was set up in Texas in 2008 to try to curb the uninsured driver problem there, but it has had mixed results. The program matches registered vehicles to a policy. Initial statistics released in 2009 showed that about 22 percent of registered vehicles were not covered by a policy. After fluctuations in that percentage, the latest data released at the end of last year showed that the unmatched proportion had risen to 23 percent.

About Ben Zitney
Benjamin Zitney has been covering the auto insurance industry for the past 2.5 years. Before coming to Online Auto Insurance News, he produced an extensive company history of the 30-year-old California Joint Powers Insurance Authority and worked at the Cal State Long Beach Daily Forty-Niner as a reporter, copy editor and news editor.

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