State insurance association seeking to strengthen auto insurance laws

Published 1:41 pm Thursday, March 4, 2010

Alabama’s Independent Insurance Association is seeking to strengthen the state’s system of ensuring the drivers are properly insured.

Rux Bentley, president of the association and Columbiana’s Rux Carter Insurance, said he and insurers across the state are supporting bills currently being considered by the Alabama legislature, which would overhaul the state’s system of verifying drivers have the minimum amount of auto insurance required by law.

If passed, the bills would create an online database of all registered drivers across the state, which would allow law enforcement officers to immediately determine if a driver is legally insured.

Although Alabama has required all drivers to carry proof of insurance cards for nearly a decade, the state’s current system has a major loophole, Bentley said.

“The problem with the current system is that it doesn’t prevent someone from paying a down payment, getting an insurance card and then canceling their coverage or never paying again,” Bentley said.

“Then, if a police officer looks at your insurance ID card, he has no way of knowing if your coverage is current or not. Sometimes, that card isn’t worth the paper it’s printed on,” Bentley added. “There’s just no teeth. There’s no way of ensuring the minimum insurance requirements are being enforced.”

The bill would also require the state to ensure drivers are properly insured when they renew their licenses each year.

“It’s estimated that either 25 or 26 percent of drivers in Alabama are uninsured. That’s number three in the nation,” Bentley said. “I have heard countless stories of people being hit by uninsured drivers.

“Then they have to pay their deductable and go to court to get that money back from the uninsured driver,” Bentley added. “You shouldn’t have to do that. Driving is a privilege, not a right.”

The bill has been brought up in the legislature in the past, but this year has marked the closest the bill has come to passing, Bentley said.

As of March 3, the Senate bill had passed the Banking and Insurance Committee, and was awaiting full Senate consideration.

The House of Representatives bill was awaiting action by its Banking and Insurance Committee.