Chapter 23 - Auto Insurance & Society (2)

Chapter 23 - Auto Insurance & Society (2) - Auto...

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RIL 211 Chapter 23 Auto Insurance and Society
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Agenda Approaches for Compensating Auto Accident Victims Auto Insurance for High Risk Drivers Cost of Auto Insurance Shopping for Auto Insurance
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Approaches for Compensating Auto Accident Victims Many accident victims are unable to recover damages The negligent driver may be uninsured or underinsured States use a number of approaches to protect accident victims from irresponsible or reckless drivers A financial responsibility law requires motorists to furnish proof of financial responsibility up to certain minimum dollar limits Proof is required: After an accident involving bodily injury or property damage over a certain amount
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Approaches for Compensating Auto Accident Victims Evidence of financial responsibility can be provided in several ways: Producing evidence of an auto liability insurance policy with at least certain minimum limits Posting a bond Depositing the amount required by law Showing that the person is a qualified self- insurer Financial responsibility laws provide only limited protection against irresponsible motorists There is no guarantee that all accident victim
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Approaches for Compensating Auto Accident Victims A compulsory insurance law requires motorists to carry at least a minimum amount of liability insurance before the vehicle can be licensed or registered Some argue that the law provides greater protection against uninsured drivers because motorists must provide evidence of financial responsibility before an accident occurs Critics cite: mandatory insurance does not reduce the number of uninsured drivers There is no correlation between compulsory insurance laws and the number of uninsured vehicles on the highway Computer reporting systems to track
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Exhibit 23.1 Table of Limits, Financial Responsibility and Compulsory Insurance Laws
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Approaches for Compensating Auto Accident Victims Five states (MD, MI, NJ, NY, ND) have established unsatisfied judgment funds for compensating auto accident victims who have exhausted all other means of recovery The accident must obtain a judgment against the negligent motorist and show that the judgment cannot be collected The amount paid by the fund is limited by state law and may be reduced by collateral sources The negligent driver must repay the fund
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This note was uploaded on 03/27/2012 for the course ACC 101 taught by Professor Smith during the Spring '12 term at Missouri State University-Springfield.

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Chapter 23 - Auto Insurance & Society (2) - Auto...

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