Motorist Financial Responsibility Legislation Passes Texas House
Texas / South Central News • May 16, 2005
Legislation establishing a program to improve enforcement of motorists' financial responsibility obligations passed the Texas House of Representatives, according to its sponsor, Rep. Bill ...
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Subject: uninsured motorists
Posted On: June 27, 2005, 7:21 pm CDT
Posted By: Jeff Mabry
Comment:
It has been a given that some individuals will always try to find a way to avoid purchasing motorists liability insurance.
Now with up to 20% of motorists being uninsured it's time to take action. If all motorists were required to pay a tax on their gasoline that would go to insure that anyone driving a vehicle, therefore buying gasoline to fuel it, would be insured for at least the minimum legally required amounts of insurance. If one assumes that most motorists drive at least 12,000 miles per year and are getting 20mpg., then most motorists would be paying $600/year. This would more than adequately cover the costs of liability insurance for such a driver. The motorist would still have to choose an insurance agent and if he was subject to higher premiums because of his driving record or if he wanted greater liability insurance and collision insurance or any other personal choice then the motorist could so inform his agent and the carrier could bill him for the additional premiums, just as they bill him now. The question of how to recompense the carrier for the minimally required liability would be solved by creating a non-profit organization that would be paid all of the taxes collected for liability insurance at the pump. It's receipts of at the pump taxes could be claimed by carriers through submission by the carrier of a list of its policyholders. Monies could then be remitted to the carrier after computer verification that no duplicate claims were being submitted by any carrier. This organization could be created by the legislature and the governor could appoint knowledgeable individuals to oversee it's activities.
The benefits of this plan are obvious, first no driver would be without the minimally required liability insurance, second the costs that our hospitals bear for victims of uninsured motorists would be eliminated. Current estimates put those costs at $90 million a year.
No one likes taxes, but this tax would be offset by: (1)the absence of premiums for liability insurance. Also insurance companies would have 20% more policyholders of this type of insurance. (3)All claims due to accidents would be covered, to the level of minimal requirements for liability insurance. The numbers used here are the most reasonable I could find,but the plan as described imposes no penalties or increased costs on anyone except uninsured motorists.
Subject: uninsured motorists
Now with up to 20% of motorists being uninsured it's time to take action. If all motorists were required to pay a tax on their gasoline that would go to insure that anyone driving a vehicle, therefore buying gasoline to fuel it, would be insured for at least the minimum legally required amounts of insurance. If one assumes that most motorists drive at least 12,000 miles per year and are getting 20mpg., then most motorists would be paying $600/year. This would more than adequately cover the costs of liability insurance for such a driver. The motorist would still have to choose an insurance agent and if he was subject to higher premiums because of his driving record or if he wanted greater liability insurance and collision insurance or any other personal choice then the motorist could so inform his agent and the carrier could bill him for the additional premiums, just as they bill him now. The question of how to recompense the carrier for the minimally required liability would be solved by creating a non-profit organization that would be paid all of the taxes collected for liability insurance at the pump. It's receipts of at the pump taxes could be claimed by carriers through submission by the carrier of a list of its policyholders. Monies could then be remitted to the carrier after computer verification that no duplicate claims were being submitted by any carrier. This organization could be created by the legislature and the governor could appoint knowledgeable individuals to oversee it's activities.
The benefits of this plan are obvious, first no driver would be without the minimally required liability insurance, second the costs that our hospitals bear for victims of uninsured motorists would be eliminated. Current estimates put those costs at $90 million a year.
No one likes taxes, but this tax would be offset by: (1)the absence of premiums for liability insurance. Also insurance companies would have 20% more policyholders of this type of insurance. (3)All claims due to accidents would be covered, to the level of minimal requirements for liability insurance. The numbers used here are the most reasonable I could find,but the plan as described imposes no penalties or increased costs on anyone except uninsured motorists.