Insurance law poses few local problems

Published 12:00 am Tuesday, August 15, 2000

Managing Editor

Aug. 14, 2000 10 PM

Statewide, some insurance companies have reported that people have found ways to skirt a new law that requires that all Alabama drivers have liability insurance on their cars, but locally, insurance companies don’t seem to be experiencing widespread problems.

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"We haven’t seen a lot of that," said Johnny Witherington of The Witherington Agency. "Sure, there are some people who are going to find ways to take advantage of loopholes, but the problems have not been widespread."

Witherington’s company saw a dramatic increase in policies written in late May and early June as Alabama joined 45 other U.S. states in passing a mandatory liability insurance law for motorists.

Witherington said that the policies that his company wrote don’t leave first-time insurance buyers a lot of opportunities to skirt the new law.

"Our insurance cards have expiration dates," Witherington said. "So if someone doesn’t pay their premium or cancels their policy, it won’t take a long time for it to become apparent to officers when the motorist is stopped."

The Associated Press reported that the problem has been severe in the Mobile area.

"Many of our new policy holders purchased a six-month policy," Witherington said. "People getting through the loopholes has not been a major problem with us."

According to the new law that took effect June 1, first-time offenders can face a $500 fine, while second-time offenders face a $1,000 fine and suspension of their driver’s license.

The law requires that all state drivers have a minimum policy that would pay a minimum of $20,000 for injuries, $40,000 coverage per accident and $10,000 for property damage.

The law allows officers who stop motorists to check for insurance, and motorists are required to have an insurance card that will serve as proof of coverage.

But those who decide to get insurance and then drop it are setting themselves up for trouble, Witherington said.

"What those people may not realize is that though they may be able to avoid a ticket for a routine traffic stop, they will be in hot water if they drop their policies and have an accident," he said. "The penalties for not having insurance for those who are involved in accidents are tremendous."

In addition to being legally responsible for all damages done in accidents, drivers without insurance who have wrecks could face license suspensions and thousands of dollars in fines and damage costs. Additionally, their licenses could be suspended.

"This is not something to take lightly," Witherington said.

Witherington hails the law as a good one that puts Alabama on equal footing with most other states.

"We were one of only five states without a mandatory insurance law," he said. "This is a good law and it will be extremely beneficial to drivers who suffer collisions and their insurance companies if they are not found to be at fault in the accident. It really makes sense to have something like this on the books."