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The State Saving Money with Insurance Verification Systems


Nearly all states are requiring their drivers to have some form of car insurance coverage. Still, many drivers remained uninsured, and they could become a potential source of income, if managed properly.

Old-fashioned methods are still being used when it comes to checking the driver’s records. Under their normal operation, auto insurers are directed to notify the DMV when a driver drops his policy. However, there is always the element of delay before DMV is notified; speeding this process could have brought additional $250 or more of fines to the state when an uninsured driver is apprehended.

The States of Montana and Nevada are working on similar online verification systems that could speed up the whole process of checking the status of the driver’s insurance coverage. This will allow their law enforcement to check the driver’s record and look at their coverage if they are active or not. Drivers with no insurance coverage are usually not allowed to register or renew their vehicles and citations issued for those who are pulled over.

In Montana alone, it is estimated that about 15% of the drivers are uninsured, which could provide a substantial income to the state. In these economically shaken years, every state needs a steady flow of income where new taxes are unfavorable; fining uninsured drivers could provide the needed money.

Drivers who are pulled over could still show all the pertinent papers but their accuracy cannot be verified. Canceled policies and delinquent payments are not reflected onto these documents. An online insurance verification system would solve this problem by searching the driver’s records in real-time, identifying fraud, if any, and ending the risks faced by these drivers because they do not have insurance coverage.

The recent recessions have triggered the rise of uninsured drivers across the country. Thousands of Americans have lost their jobs and are living on a tight budget – putting car insurance coverage out of their priority list. They simply could not afford it anymore.

However, as they say, auto insurance is not a luxury but a necessity. Lawmakers are on their toes trying to find more ways to offer low cost insurance coverage for low-income drivers. Some states are even subsidizing the cost to guarantee that every driver in their region will have some sort of protection. Insurance companies are also offering negotiable rates for drivers who have serious illnesses, lost their livelihood or income and death of a family member.

Some states are introducing innovative ways so that people can afford for car insurance; enjoying the benefits and paying for less.

Insurance per mile. Drivers are charged according to their mileage. For instance, a driver could set a 10,000-mile mark. The more miles purchased, the lesser the cost of his insurance policy. If he needs additional mileage, he can simply call his insurer to purchase more.

In-vehicle equipment. Special device may be installed to keep track of the actual usage, which will become the basis for computing the rates.

Pay at the pump. Insurance rates are added on top of the fuel’s price.