If New Laws Require Insurers to Report All Cancellations, Will SR22's Become Obsolete?

[BlockO]

I don't know how many states require insurers to report all auto insurance cancellations to the BMV/DMV, but there are plenty of states who are considering doing so.

I am curious as to how many states already have such a system in place?

I know that PA insurers report all cancellations. I highly doubt it's a coincidence that PA is one of only six states that do not have SR22 filings. Because if every cancellation is reported, then there is no use for an SR22.

The other five states that do not have SR22's are KY,DE,OK,NM & MN. Do they all require cancellations to be reported? I'm very interested in hearing from agents of those states.

I'm asking because it's about to affect two of my states. West Virginia is planning on having such a system in place by the first of next year (as of now, WV has an SR22, but it's unclear whether or not the SR22 will exist once this gets implemented). Ohio will be considering it also, starting in March. Ohio has a very high percentage of SR22's compared to other states because of the way current laws are set up (laws are very lax at license/registration renewal, but then they nail people with random letters later on).

As I see it, if such a system does come to fruition, what would be the point of having SR22's? I see none. Please correct me if I'm wrong.

I'm usually resistant to change, but not this time. I think any system that keeps closer dibs on an uninsured driver is a good thing from both an agent's standpoint and society's as well.

Curious to hear your thoughts.

 

[djs]

CA reports all cancellations and yet, still has Sr-22's. I have often wondered/thought the same thing.

There is a difference though in the timing requirements. Standard cancellations I think have a 'reinstatement potential' delay option (not sure, but seems to happen) where SR-22's are 'timely'.

Dan

 

[BlockO]

CA reports all cancellations and yet, still has Sr-22's. I have often wondered/thought the same thing.

Thanks Dan. You just reminded me of a question I forgot to ask: If a state has the system in place, but still has SR22's, do the carriers still apply a surcharge to the premium?

 

[djs]

Let me try to explain this since I'm not sure what you are asking, completely.

There is a fee to have an SR-22 issued, around $20-$30. There is no premium surcharge other than that fee just for the SR-22, but, obviously, the infraction that caused the need for the SR-22 may have a premium surcharge associated with it, such as a DUI.

Dan

 

[b61mack]

In PA, they only send notice of cancellation, not non-renewal.

 

[BlockO]

Let me try to explain this since I'm not sure what you are asking, completely.

There is a fee to have an SR-22 issued, around $20-$30. There is no premium surcharge other than that fee just for the SR-22, but, obviously, the infraction that caused the need for the SR-22 may have a premium surcharge associated with it, such as a DUI.

Dan

Let me try re-wording that again..... What I meant was, if the insurance company is already required to file with the DMV anyways (with or without an SR22), then why the need to charge an extra $20-30 for the SR22 filing?

To me, that sounds like a class action lawsuit waiting to happen.