No Pay, No Play Explained

By Author: Marcus Stalder
Total Articles: 491
Comment this article

In theory, the world is all about fairness. Whether you come at the issue as a Christian with everyone equal in the eyes of the Lord or you subscribe to more liberal views based on human rights, everyone should get a fair shake. Except, the world is far more dog-eat-dog with only the strong able to get what they consider to be their rights. So, against this background, here's a simple question for you. What should we do with the people who refuse to buy the minimum liability insurance cover? For now, we will look the other way on the unemployed poor who literally cannot afford it. The morality is different. We will assume there are people who have the money but, for whatever reason, refuse to pay their way. Well, in all but three states, it's a criminal offense to be on the public roads with an uninsured vehicle. If such drivers are caught, the usual punishment is a fine. It's all part of the pattern of financial responsibility laws and, in most cases, people are not to drive again until they produce evidence they have valid insurance. In the "hardline" states, the fines can be high and, if not paid, the vehicle can be confiscated. ...
... Indeed, a few states confiscate the vehicle anyway.

This all sounds great except for one small detail. All the states could link up all the databases run by the various government departments, the police and the insurance companies. So, at any moment, it would be possible to see whether a vehicle was insured. This would make enforcement of the mandate straightforward. The licensing authorities and police would have a list of everyone with an uninsured vehicle. Tow trucks could tour the streets collecting those vehicles from their homes or the police could pull over any vehicles found on the road. As it is, most states do not give the police access to the insurers' systems. Whenever a vehicle is pulled over, there's no way to tell whether there's insurance in place. This means there's a very good chance people will not be caught and/or prosecuted.

So a small number of states have introduced a "no pay, no play" rule. In the usual tort states, a driver not at fault has the right to sue for the full range of damages. But in Alaska, California, Iowa, Louisiana, Michigan, New Jersey, North Dakota and Oregon, the uninsured driver cannot sue to recover all heads of damages from the at-fault driver. The idea is that if you do not pay the same premiums as the honest driver, you should have no right to claim the full compensation. Four other states are currently considering amendments to their laws which would introduce similar rules.

It's interesting to see some states take up the notion of fairness when it comes to carrying insurance. This might be slightly harder on the driver who genuinely cannot afford to pay even the cheapest auto insurance quotes, but it certainly feels like justice for the willfully uninsured driver. He or she should never be in a better financial position than those who accept and pay the best of the auto insurance quotes.