Uninsured Drivers are Driving Up Insurance Costs

Like most US states, it is considered a misdemeanor to drive in Georgia without car insurance. It can result in fines, license suspension, and even jail time. However, that hasn’t stopped an increasing number of drivers from ditching auto insurance all together.

Most recent statistics show that in 2022, 14% of drivers nationwide do so without coverage. It has climbed 3% from the prior 2019 data. Of all 50 states, the following rank highest in rates of uninsured drivers:

Washington D.C. (25.2%)
New Mexico (24.9%)
Mississippi (22.2%)
Tennessee (20.9%)
Michigan (19.6%)
Kentucky (18.7%)
Georgia (18.1%)
Delaware (18.1%)
Colorado (17.5%)
Ohio (17.1%)

Only New Hampshire permits driving without the purchase of car insurance–which has only deterred 7.8% of the state’s population from purchasing coverage. Virginia previously allowed people to drive while uninsured, until they finally made it mandatory earlier this year.

The reason so many Americans have decided foregoing insurance is worth the risk is simple: it’s expensive! In fact, car insurance rates have climbed a hefty 12% from last year.

Unfortunately, the uptick in Americans dropping coverage is driving up costs for everyone else. This is because the premium pool is significantly reduced. In other words, with fewer people contributing to the “fund” which is supposed to cover accident and damage expenses, insurance companies now charge more to policyholders to make up for that loss.

This creates a cycle that only aggravates the issue. As prices continue to rise, customers are increasingly inclined to waive their coverage, thus driving up insurance prices even more.

The state of Michigan has put reforms into place to combat this problem. As of 2019, residents are no longer required to purchase unlimited Personal Injury Protection (PIP). Since drivers are now free to choose a plan that suits their budget, roughly 6% more drivers have become insured since its enactment.

While scrapping your auto insurance may seem tempting–especially in times of financial distress–Jones & Swanson wants to remind you of the importance of being covered. As a top car accident law firm in Marietta, we know firsthand just how much it matters.