640 Class 9 Bryan

640 Class 9 Bryan - AUTO INSURANCE AND SOCIETY 1...

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1 AUTO INSURANCE AND SOCIETY
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2 COMPENSATING AUTO ACCIDENT VICTIMS Compulsory Insurance Laws Every licensed driver must have auto liability insurance to operate a vehicle Physical Damage is not required Enforcement Issue In many states, 10% or more of the drivers do not carry insurance Financial Responsibility Laws Proof after the accident or conviction Usually moderate amounts such as 25K per person and 50K per accident for liability Unsatisfied Judgment Funds Uninsured Motorists Coverage No pay- no play Uninsured driver cannot sue negligent drivers for non- economic damages No Fault Insurance
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3 Auto Insurance Plans and Non-Standard Auto Insurers The system must make insurance available to everyone qualified to purchase it Most people purchase insurance in the voluntary market from mainline insurers such as State Farm, Allstate, GEICO, etc. For higher risk insureds, there are non-standard auto insurers who specialize in this business Higher rates More severe merit rating Payment plans For insureds that cannot obtain insurance in the voluntary market, they can obtain auto insurance in the Auto Insurance Plans Industry run systems for allocating insureds to participating companies Uniform rates, contracts, and payment plans Everything else by company
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4 Restrictions on Rating
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This note was uploaded on 07/17/2008 for the course BUSFIN 640 taught by Professor Krempley during the Winter '08 term at Ohio State.

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640 Class 9 Bryan - AUTO INSURANCE AND SOCIETY 1...

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