New auto insurance regulation may make Alabama roads safer
In Alabama, a new auto insurance regulation is scheduled to take effect January 1, 2013, which will institute a new system that will make it more difficult for drivers without insurance coverage to be on the road. The new system is expected to crack down on the 900,000 vehicles registered in the state that do not have any kind of auto insurance coverage. According to state law, drivers must maintain liability insurance coverage, but Alabama has been struggling to make sure drivers meet the insurance requirements for years.
State and county officials to verify insurance information
As part of the new system, county license plate offices will be required to verify a driver’s insurance information when processing renewals. Law enforcement personnel will also verify this information when stopping vehicles for traffic offenses. The Alabama Revenue Department will also conduct random, but regular inspections of insurance databases to see if drivers have dropped their coverage without obtaining a new policy.
Uninsured drivers face steep fines for going without coverage
Those without auto insurance face a $500 fine for their first offense. This fine jumps to $1,000 for subsequent offenses and can ultimately result in the suspension of a vehicle’s registration. Reinstating a vehicle’s registration after it has been revoked due to being uninsured will cost as much as $400. Alabama lawmakers claim that the fines associated with the regulations will provide drivers with adequate incentive to purchase and maintain some form of auto insurance coverage.
Auto insurance regulation expected to put an end to a serious problem
The auto insurance regulation is meant to put an end to the problem of uninsured vehicles in Alabama. Lawmakers claim that this issue is leading to high auto insurance costs because of the financial risk uninsured vehicles pose for both companies and consumers. The new system set up through the auto insurance regulation has cost approximately $150,000 to set up. The state is expected to surpass the costs associated with the system through revenue generated by citations and fines imposed on uninsured drivers.