DATE: Tuesday, March 25, 1997               TAG: 9703250245

SECTION: BUSINESS                PAGE: D1   EDITION: FINAL 

SOURCE: ASSOCIATED PRESS 

DATELINE: HARRISONBURG, VA.                 LENGTH:   56 lines

LAWS TOUGH IN OFFENDERRS - AND THEIR INSURANCE

Ron Helmuth's entire family lost their auto insurance coverage when his 17-year-old son was caught drinking a beer at a party and lost his license, even though the boy wasn't driving that night.

Helmuth and other members of Save Your Insurance warned parents Monday that Virginia's tough laws against teen-age drinking and drug use can have surprising and expensive consequences.

``We have no agenda for changing laws or changing insurance policies,'' Helmuth said before members of the new citizen's group which held a news conference at Harrisonburg High School. ``We are entirely focused on educating parents.''

Since 1994, Virginia drivers younger than 21 can have their permits or licenses suspended if they are caught possessing alcohol or if they have so much as a drop of alcohol in their blood system while driving.

With the use-and-lose and zero tolerance laws, insurance companies in Virginia have started routinely canceling family auto insurance policies when a teen-ager's license is suspended.

That's because Virginia is one of the few states that makes everyone in the household liable for insurance costs when one member gets in a wreck, according to David Newlin, a board member of the Professional Insurance Agents of Virginia.

Helmuth had no idea of the added risk when he paid an extra $350 a year to put his son on the family insurance policy. He gave the boy the typical parental warning along with the car keys: Don't drink and drive.

``Most teens can quote the use and lose laws by heart and they are choosing not to drink and drive,'' said Pat Grizzel, the student assistance coordinator at Harrisonburg High School. But most don't know the potential cost of getting caught just possessing alcohol, she added.

Helmuth's insurance company found out about his son's license suspension when it made its periodic scan of Department of Motor Vehicle computer databases.

The company had no access to the nature of the violation because of confidentiality laws protecting minors. It just knew that someone in the family had a license suspension and that made the policy too risky to cover.

Newlin, who is a partner in a Winchester insurance agency, said six of the eight companies he works with automatically cancel policies when they find a suspension - either immediately or when they're up for renewal. The other two try to get additional information about the suspension before making the decision.

``Once a family is canceled, it's difficult to get back into a standard insurance carrier,'' Newlin said. ``I think we are going to see a whole lot more of this. Virginia is taking a pretty hard-nosed stand.''

In Helmuth's case, the insurance company agreed to draft a new policy that covered him, his wife and their 15-year-old son. The catch was, his older son had to get a separate policy - costing $2,200 annually for five years - and his own car. KEYWORDS: AUTOMOBILE INSURANCE

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