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But people are still beating the system

Enforcement efforts add teeth to auto insurance law

By BECKY GILLETTE

MBJ Staff Writer

Recently a Delta insurance agent was perplexed when one afternoon his office was swamped by about 50 people coming in to buy automobile insurance.

Why the sudden rush? A rumor was going around that the sheriff’s department was planning a roadblock that night and would be checking for proof of liability insurance along with proper driver’s licenses, inspection stickers and license tags.

When the new mandatory car insurance law for Mississippi went into affect in January, there were concerns that the law lacked the teeth for proper enforcement.

But across the state officers have been checking for proof of insurance whenever cars are stopped at roadblocks or for traffic violations. Anyone without proof of insurance can face a fine of $100 or more.

“I was one of those who doubted that the law was strong enough, and it may not be,” said Mississippi Insurance Commissioner George Dale. “But I am extremely pleased with the aggressiveness of law enforcement in attempting to enforce the law. If it had not been for that, the bill would not be any good at all. We’re seeing more roadblocks where they ask for a driver’s license, stickers and the proof of insurance policy. It is doing an awful lot to encourage people to get insurance.”

Dale said there isn’t any current data about how many new insured motorists have been added to the rolls since the mandatory insurance law went into effect. But he said the number of calls his office receives from people complaining about being required to purchase auto insurance is evidence that the law is working.

“The law is good for business and consumers,” Dale said. “So many people have been involved in accidents where the other party is at fault, and the other party doesn’t have insurance. Most people resent having to file it on their own insurance policy when the other person is at fault and they aren’t responsible for the damage they have done. They usually have to pay the $250 deductible just for being in the wrong place at the wrong time.”

Despite some success with the new law, a lot of motorists are trying to find ways around the law, says Diane Clark, an agent in the Gulfport office of Worldwide Insurance.

“There is no bite to the law,” Clark said. “People are able to get their tag without showing proof of insurance. Nobody is checking up on it. The only way they are caught is if there is a roadblock or an accident. More needs to be done to enforce the law. There needs to be some way to check up on it like requiring them to show proof of insurance when they go to renew their tag.”

Clark said her office saw the number of applicants for insurance spike in January when the law went into effect, and extra people were hired to handle the demand. But a number of those people took out a one-year policy, paid only one month, and then let the policy lapse. But they still have the card for one year that indicates they have insurance.

“A lot of people know how to beat the system,” Clark said.

Because of the problems, Clark said a lot of companies now don’t allow agents to write one-year policies unless it is paid for at the time it is taken out. Instead, companies are writing policies for only six months, and policyholders get a card that is good for only six months.

State Farm Agent Tim Chadick of Biloxi said that his office has seen a moderate increase in formerly uninsured people coming in to purchase policies. But he said they didn’t see a big influx of new business comparable to the time when Alabama implemented mandatory automobile liability insurance.

Chadick said it is yet to be determined whether the consumer will benefit from mandatory liability insurance in Mississippi. That won’t be known until it is seen if there is a reduction in uninsured motorist claims over the long term.

Chadick is reserving judgment right now on whether the legislation that was passed is adequate or needs to be improved. “It is really too early to tell,” he said. “The intent of the law is good. It is going to take cooperation from the consumers and strong enforcement to help the new law be as effective as we would like in Mississippi.”

For more information on mandatory automobile insurance, see the web site http://www.doi.state.ms.us/consumer/compulsoryautomobileinsurance.html.

Contact MBJ staff writer Becky Gillette at mullein@datasync.com or (228) 872-3457.


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