Roanoke Times
                 Copyright (c) 1995, Landmark Communications, Inc.

DATE: THURSDAY, October 20, 1994                   TAG: 9410200073
SECTION: VIRGINIA                    PAGE: C-1   EDITION: METRO 
SOURCE: RAY REED
DATELINE:                                 LENGTH: Medium

DMV TRIES BUT CAN'T NAB ALL SCOFFLAWS

He said any motorist can check "yes" for insurance on the license renewal and this answer is not checked for validity. He also said the insurance premium we honest drivers pay for uninsured-motorist coverage goes to pay our insurance company if we are struck by one of these deadbeats in an accident.

He also said the $400 fee Virginia charges those who admit they are not insured goes into a "mystery fund," and nobody knows what happens to it, but it does not go to any insurance company.

It looks like the rest of us are paying for uninsured drivers and habitual offenders. Can you provide clarification?

D.S., Roanoke

A: There are a lot of misunderstandings on this subject.

Taking the juiciest one first, there is no "mystery fund." Virginia's Department of Motor Vehicles collected $8million in fees and penalties from 26,000 uninsured motorists in fiscal 1992-93, and $4.1million was shared among insurance companies. DMV kept nearly the same amount for administrative costs.

Regarding compulsory auto insurance, Virginia and nine other states don't require it. That's not necessarily bad, in the eyes of the insurance industry. Enforcement of the law is more important, and Virginia catches up with a lot of uninsured motorists.

In the 1993 fiscal year, 7,637 drivers admitted they were uninsured and voluntarily paid the $400 fee, which does not provide insurance coverage.

Using a random-check computer program, Virginia asked 300,000 other drivers to report the name of their insurance company. When the responses were checked against company records, more than 7 percent were found to be uninsured.

That amounts to 18,228 drivers who were assessed the $400 fee, plus a $400 penalty, plus a $30 reinstatement fee to get their driver's licenses back after an automatic suspension.

The random checks nail uninsured drivers before they're involved in an accident, instead of afterward.

Virginia also verifies insurance when a driver gathers a lot of demerit points, or a motorist whom police suspect of being uninsured has an accident or gets a traffic ticket. These steps nab another 8,000 per year.

To the other points of your question, do insurance premiums cost more because some drivers are uninsured? Yes, about $26 per insured vehicle is the standard rate.

How many uninsured motorists are there? Nobody can say, but Virginia has detected about 133,000 since 1986. Are the rest of us paying for those who haven't been caught? Yes.

Source: 1994 annual report of DMV to the governor and General Assembly.|

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