Budget-strapped Rhode Island is considering a new way to raise money: Force insurers to buy official driving reports from the state, at $20 a driver.
The move — part of a budget amendment that would alter laws surrounding insurers’ use of insurance scores and underwriting rules — adds a provision requiring insurers to but a customer’s official driving abstract at least once every three years.
The move is included as part of the budget articles submitted to the general assembly’s finance committee.
Insurers oppose the fees.
“This provision would essentially force insurers to purchase motor vehicle driver’s license records from the Division of Motor Vehicles so that the state can collect additional revenue at the expense of insurers and their policyholders,” said Paul Tetrault, Northeast state affairs manager for the National Association of Mutual Insurance Cos., which opposes the bill. “It would unnecessarily impose significant costs on insurers that would ultimately be borne by Rhode Island drivers.”
Tetrault said the $20 charged by the state’s division of motor vehicles for records is high, so insurers find it cost-effective to obtain driving record information from third-party sources rather than from the state.
“The state has essentially priced itself out of the market for such information… it is simply inappropriate for the state to force insurers to purchase a product from the state,” he said.
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