Rhode Island Gov. Lincoln Chafee recently OK’d a proposal to create an insurance database identifying uninsured drivers that officials are aiming to have up and running next summer.
Gov. Chafee signed off on legislation last week that authorizes the state’s Department of Motor Vehicles (DMV) to begin culling possible contractors.
According to the proposal, the eventual pick will establish the database, maintain it with driver information provided regularly by the DMV and car insurers and oversee notices issued to motorists identified in the database as lacking coverage.
–A first notice would be sent to a car owner ID’d by the database as lacking insurance coverage for at least three months.
–That car owner would have 15 days to provide proof of coverage.
–A second notice would be sent to the car owner if no proof of coverage is provided.
–That car owner would have another 15 days to provide proof of coverage.
–If proof of coverage still hasn’t been provided, the DMV would cancel the car owner’s license and registration.
–Drivers looking to reinstate their license and registration would then pay a $250 fee after providing proof of coverage (additional fines and penalties could apply).
Totaling those fees should mean the state nets about $3.5 million in the program’s first year, according to a fiscal analysis.
Databases Around U.S. Aim to Cut Rates of Uninsured Drivers
Lawmakers said they hope the database will make a dent in the number of drivers lacking insurance in the state, which has one of the highest rates of uninsured drivers in the U.S., according to the latest data from the Insurance Research Council (IRC).
According to the IRC, more than 17.5 percent of drivers lack the car coverage required to be on the road.
An estimate from the state House put the uninsured rate at “somewhere between 15 and 18 percent” of licensed drivers in Rhode Island.
Rhode Island’s proposal is modeled after a program created in Utah, which Rhode Island lawmakers applauded as one of dozens throughout the U.S. that add teeth to laws requiring that drivers have auto coverage.
“It does not make a lot of sense to have a law that requires motorists to have insurance, only to have law-abiding drivers paying higher premiums because they have to have uninsured motorist coverage,” Sen. Louis DiPalma (D-Middletown) said in a statement.
Lawmakers estimate that the state will see an additional $18 million in premiums that “previously uninsured motorists would be compelled to pay.”
Injecting the market with more premium dollars could mean cheaper insurance for all the state’s drivers with uninsured motorist coverage, which protects drivers in collisions with other drivers lacking a policy, according to Rep. Brian Patrick Kennedy (D-Hopkinton), one of the proposal’s sponsors in the state House.
DiPalma, Kennedy’s sponsoring counterpart in the Senate, echoed the sentiment.
“The sooner this database can get operational … the sooner drivers should see a positive impact on their premiums,” Sen. DiPalma said.