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Senate bill would require auto liability insurance in Virginia

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A proposed bill moving through Virginia’s legislature would require proof of auto insurance before registering new vehicles.

Virginia is among two states (New Hampshire is the other) that don’t require vehicles to carry liability insurance as long as drivers pay a $500 uninsured motor fee.

The surcharge does not provide drivers with any coverage. It goes into a special fund for insurance companies whose policyholders were injured or their vehicles damaged by an uninsured driver.

SB 951 would change that, said Sen. Frank Ruff. (R-Mecklenburg), who introduced the bill on behalf of the Virginia Loggers Association.

“I had no expectation of it passing because the policy had been in effect for many decades,” he told Repairer Driven News. “In years past, there had been attempts to raise the amount higher. Each time it failed.”

This time, however, it’s gaining traction, passing with overwhelming support in a number of subcommittees.

During the most recent Transportation Committee meeting, state Rep. David Suetterlein (R-Roanoke) spoke in support of the bill, saying his position on the matter has shifted.

“I used to think that it was a good thing that we provided the $500 fee option,” Suetterlein said. “This is one of the issues that my thinking has changed more than any other over the last decade.”vir

Ruff said there’s no value in the existing legislation, and that it allows people to skirt around being responsible vehicle owners. Some drivers who opted out of insurance avoided paying the uninsured motor fee by falsely claiming farm use exemptions, he said.

“I discovered in the process that it is believed that nationally almost 10% of the vehicles on the road are uninsured,” Ruff told RDN. “So even though the fee is currently required, if there is no insurance, only about 600 vehicles are covered. This means that far more have figured out different ways to beat the system.”

Insured drivers help offset the costs through “uninsured motorist fees” that are tacked onto their insurance policies. It requires insurers to pay for the damage if a policyholder’s vehicle is hit by an uninsured driver.

Every other driver on the road pays for this through their own insurance policy with a single line “uninsured motorist fee.” This requires your insurance company to pay for your damages if an uninsured driver hits you.

Ruff said that’s just one of several gripes he has with the existing legislation.

“That is only a portion of the problem. Another problem is that one can simply pay the Department of Motor Vehicles a fee of $500 dollars protecting no one,” he wrote in a letter published in the Brunswick Times-Gazette. “Then the state allows one to drive at everyone else’s risk.”

He told RDN that most uninsured drivers have limited assets to pay for their repairs and are often doing it themselves or junking the vehicle. He did not respond to a follow-up question about whether there’s concern uninsured drivers might continue to use damaged vehicles, creating hazards for others on the roadways.

More than 5,000 drivers sidestepped insurance by paying the $500 fee during the 2022 fiscal year, according to the Richmond Times-Dispatch.

Ruff hinted that the state’s stance on uninsured vehicles could be contributing to rising policy rates. According to one study, Virginia’s rates spiked 25% last year.

“Hopefully, this will slow down any rise and maybe even push premiums down,” he said.

It’s no secret that auto rates throughout the nation are rising, with Allstate saying it will likely increase rates to offset the higher costs of doing business.


Featured image credit: Gwengoat/iStock

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