An article in yesterday’s Los Angeles Times pointed to the fact that when unemployment rises, so does the number of motorists driving without auto insurance. Insurance analysts estimate that for every rise of one point in the unemployment rate, the number of uninsured drivers goes up more than three-quarters of a percentage point – that’s nearly a one-to-one correlation. It makes sense from a practical standpoint because if someone has to choose between paying the rent and paying high auto insurance premiums, they will generally choose to keep a roof over their head each and every time. Yet, that makes for a dangerous situation on the roads because we are in difficult times and analysts guestimate that there may be as many as one in six drivers who are uninsured by next year, which is just around the corner.
Most states require all vehicle policies to provide coverage for the so-called “uninsured motorist,” the motorist who hits you and damages your car or injures your person and who carries no insurance on their own vehicle. Who pays? Generally, your policy, under the uninsured motorist coverage, would foot the bill. However, what happens if an out-of-state insured driver is involved in an accident while driving in New York with a driver who is not insured?
New York law requires that all motor vehicle liability policies issued for vehicles in New York must provide for a minimum of $25,000/50,000 in uninsured motorist coverage in the event occupants of an insured vehicle suffer bodily injury or death as a result of an accident caused by an uninsured vehicle. (NYS Ins. Law §3420(f)(1) As for out-of-state drivers, New York law provides that out-of-state insurers which are licensed to do business in New York must provide the minimum amount of coverage for the non-resident motorist (NYS Ins. Law §5107) regardless of whether their policy included such coverage when it was issued. Midwest Mutual Ins. Co. v. Pisani, 673 NYS 2d 126 (1st Dept. 1998)
Therefore, the word of warning would be to check with your insurance carrier and go with a reputable company. The insurance giants like Allstate, State Farm and Geico are probably licensed to do business in every state of the country but smaller local companies might not be and you may leave yourself exposed to hefty repair and medical bills if you’re involved in an accident and your policy does not provide for uninsured motorist coverage.