About one in eight U.S. drivers on the road in 2015 was uninsured, according to a new report released this month from the Malvern, Pa.-based Insurance Research Council (IRC).
After a seven-year decline from a high of 14.9% in 2003, the countrywide uninsured motorist (UM) rate increased from 12.3% in 2010 to 13.0% in 2015.
Uninsured motorist rates varied substantially among individual states, ranging from just 4.5% (or roughly 1 in 20 drivers) in Maine to a whopping 26.7% in Florida.
Not only are these uninsured drivers breaking laws — they’re also driving up auto insurance premium costs for everyone else by an average of $67.30 per covered car. That accounts for 5% of the average American’s annual premium.
Despite the recent increase in the countrywide UM rate, several states with chronically high rates of uninsured drivers experienced significant declines in UM rates. Oklahoma’s UM rate in 2015 was 10.5% — 15.4 percentage points lower than the state’s 25.9% rate in 2012. New Mexico also experienced a significant decrease in its UM rate — falling from 29.8% in 2006 to 20.8% in 2015. Even with the substantial improvement, however, New Mexico still had one of the highest uninsured motorist rates in the country in 2015.
Other states with significant improvement include:
- Alabama (8.0 percentage point decline from 2006–15)
- Arizona (7.2 percentage point decline)
- California (5.7 percentage point decline)
Despite the recent improvement in states with chronically high UM rates in the past, the number of jurisdictions with increasing rates from 2010–15 doubled the number with decreasing rates.
The biggest offenders: Florida, Mississippi, New Mexico, Michigan and Tennessee have the highest uninsured motorist percentages, all over 20%
“The drop in uninsured motorist rates in several states certainly is good news,” said Elizabeth A. Sprinkel, senior vice president of the IRC. “However, the increase in the countrywide rate is a concern. IRC is exploring why uninsured motorist rates vary so much across states and why the countrywide rate is once again be on the rise.”
The IRC report, Uninsured Motorists, 2017 Edition, examines data collected from 14 insurers representing approximately 60% of the private passenger auto insurance market in 2015. For more information on the study’s methodology and findings visit www.insurance-research.org.
About the Insurance Research Council: The IRC is a division of The Institutes, an independent, nonprofit organization dedicated to providing educational programs, professional certification (including the CPCU designation), and research for the property-casualty insurance business. The IRC conducts research on a wide range of public policy issues affecting property-casualty insurance companies and their customers, and is supported by leading property-casualty insurance organizations.