The primary reason people drive without insurance is obvous - money. Some
drivers intentionally cancel their policy to save money while others fail
to pay their bill when it is due and their policy is cancelled for non-payment.
Either way, this causes problems for innocent drivers because there is
no mechanism by which the insurance company notifies the police or government
that a policy has been cancelled. Instead, a driver has to certify that
they have insurance when they register a car, but nothing stops someone
from cancelling their insurance after doing so. If that is done, as long
as the person does not get into an
automobile accident, they are saving money.
For people facing severe money issues, not paying insurance is a risk they
are willing to take to be able to pay their rent, buy food, or have money
for more urgent needs. Moreover, rarely is anyone arrested or even cited
for not having insurance – instead, people usually tell a reporting
police officer that they have insurance with a company (most likely the
one that they previously had) and that is sufficient to avoid a ticket.
They also claim that they thought it was valid or didn’t know it
had been cancelled. I have rarely, if ever, seen a police officer cite
a driver not having insurance, even after a serious motor vehicle accident
causing significant personal injuries.
A similar situation is collision coverage. That covers you for damage to
your vehicle that is either your fault or not anyone’s fault. Therefore,
it generally does not affect any other driver. Many people cancel this
insurance to save money; hoping that they do not have an accident. However,
if they do have an accident and there is no other driver who is responsible,
or the other driver also has no insurance, then they have a problem –
there is no insurance to pay for the damage to their car.
If a car is older and the owner is willing to junk it in case of an automobile
accident, then cancelling collission coverage may make sense. But, if
not, it can cause seroius financial issues - right afer an accident, when
you need your car to get to a doctor and continue working, you will not
have one and will have no insurance to use to quickly get one. Even if
the other driver involved in a motor vehicle accident has insurance, that
insurance company may take a long time to invesigate the accident and
make a decision on whether to accept liability for your damges, both to
your car and your
personal injury damages.
Overall, insurance seems like a luxury to many people and for people facing
dire financial needs, it may be. But, not having it is not only illegal,
but potentially risky. The money you save may not be worth the cost you
will pay if you are in a serious motor vehicle accident. Before cancelling
your insurance, it makes sense to reduce coverages and raise deductbles.