More Drivers Going Without Insurance

Ed Gilmartin knew something askew 50 customers when their car insurance fell in November and December.

"It was more appeals from 1 January to Thanksgiving than in any other years, we have experience," said Mr. Gilmartin, who is the owner of Gilmartin Insurance Agency in Scranton.

More car insurance consumers abandoning illegally during the economic crisis, increasing the risk to themselves and other drivers.

"As economic conditions deteriorated dramatically, you are probably driving more people uninsured," said David Corum, a Vice President at the Insurance Research Council, the industry-funded group based in Malvern. "People who are insured will pay more because the costs of uninsured drivers are distributed among those of us who have coverage."

The Council will issue a report this week correlating increase in unemployment in the revitalization of uninsured drivers. Based on estimated national unemployment rate of 7.5 percent in 2010, the percentage of uninsured drivers would increase to 16 percent from 14.5 percent in 2005, the report projects.

This may mean 3 million more uninsured drivers on our roads in 2010 than in 2005, based on U.S. Department of Transportation data.

State model also points to more drivers "born" in the industry term for driving uninsured.

Suspension of registration for the car insurance lapsed totaled 97,000 between July and December, running 21 percent ahead of the same pattern in 2007, State Department of Transportation figures show. A penalty for carrying out the uninsured includes $ 300 fine and three-month suspension for a driving license and vehicle registration.

"Unemployment causes tremendous pressure on the insurance market," said Sam Marshall, chairman of the Insurance Federation of Pennsylvania, the trade association based in Philadelphia. Usually from 5 to 8 percent of registered state uninsured drivers, it estimates.

Chart is a bad turn for all motorists. If an uninsured driver hits your insured, the victim may have to sue to recover damages. Many uninsured drivers minimum assets.

Drivers can protect themselves from uninsured and underinsured coverage, but these contributions are increasing, Mr. Marshall said.

"If you see an increase in uninsured drivers, you're going to see an increase in uninsured (coverage) rates," he said.

Car insurance rates are rising across the board. Contributions in December were 4 percent higher than year ago levels, U.S. Department of Labor data show.

Economic tailspin caused national and regional unemployment to the highest level in a decade - 7.2 percent and 7 percent nationwide in the Scranton / Wilkes-Barre / Hazleton metro area. Climbing consumer costs combined with declining home values shares retirement accounts have been transferred millions of households into insolvency.

For some drivers, dropping the car insurance is an excellent choice among unpleasant options.

"If you give something, car insurance can be," Mr. Gilmartin said.

Renee Jennes, President Jennes Insurance Agency in Throop, noticed a car insurance appeals are starting to jump to six months ago.

"We're seeing a lot of people who came to nonpayment. They simply can not pay your bills," Ms. Jennes said.

Agents also see more customers’ change of policy, such as the eradication of conflicts and comprehensive scope, in order to reduce costs.

"People are calling us; they have difficulty with their bills. They are looking at their payments down," said Bob Turano, who owns insurance agencies in Honesdale.

"Many people throw their insurance, many are reducing their coverage, and many are purchasing insurance," Mr. Gilmartin said.

Contact the writer: jhaggerty@timesshamrock.com

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