The chances of being hit by an uninsured driver have increased. So how can agents help clients get the coverage they need if that happens?As if getting into a car accident weren’t bad enough, an increasing number of drivers face the rising possibility that the other driver may be uninsured, leaving them to pay for damages even if they weren’t at fault. When the Insurance Research Council (IRC) and the Hanover Insurance Group collaborated on a study of uninsured drivers, they found that as 13% of American drivers in 2015 (or just over one of every eight) took to the road without coverage.
That number marked an increase from 2010, when the percentage stood at 12.3%. It also reverses a seven-year trend that saw the number of uninsured drivers gradually decline after hitting a high of 14.9% in 2003.
IRC calculated its finding by comparing the ratio of insurance claims submitted by people injured in a crash with an uninsured driver to claims involving crashes with insured drivers. The organization analyzed data from 14 insurers responsible for roughly 60% of the private auto insurance market in 2015.
Top States for Uninsured Drivers
This alarming drop in coverage comes despite the fact 49 states mandate that drivers buy auto insurance. Only New Hampshire and the District of Columbia don’t require drivers to purchase coverage. Five states exceeded the national percentage, with 20% or more of each state’s drivers manning vehicles without insurance. Tennessee, Michigan, and New Mexico all came in around 20%, while Mississippi (23.7%), and Florida (27%) had an even higher number.
At the other end of spectrum, Vermont, North Carolina, Massachusetts, New York, and Maine all sported percentages below 10%, with Maine enjoying the lowest at 4.5%. Nevertheless, even states with few uninsured drivers saw those numbers increase. Massachusetts, for example, witnessed a twofold jump in uninsured drivers.
Having more uninsured drivers on the roadways poses a tremendous financial risk for those who do carry insurance. Since an uninsured driver cannot pay for damages, the insured driver — and his or her insurance company — is left to pick up the cost of bodily injuries and car repairs.
Those damages can be costly. According to IRC, the average claim involving an uninsured driver can reach as high as $20,000 just for medical expenses and lost wages without taking into account the cost of restoring the vehicle to road condition.
What Agents Can Do
Although the IRC researchers don’t speculate on why people drive without insurance coverage, the reason could be related to the skyrocketing costs of auto premiums. Nevertheless, agents must stress to their clients the importance of carrying this coverage and help them protect themselves in the event that they’re involved in a crash with an uninsured driver.
Drivers can, for example, tack on uninsured/underinsured motorist coverage to their policies in the same amount they have for bodily injury. If they have a bodily injury limit of $100,000 if one person is injured, then their uninsured/underinsured coverage should be equal to that number. An umbrella policy that provides coverage beyond the limits of the auto insurance policy is another option.
In light of the growing number of uninsured drivers on the road, insurance agents should emphasize to their clients that the expense of funding the medical bills and car repairs after colliding with an uninsured motorist will be far greater than any premium. Insurance agents can help them find a comprehensive yet affordable policy that covers all probabilities.