Learn about insurance before buying a car

Speaking from the bar

Thinking of buying that neat little roadster that’s been for sale in your neighbor’s driveway since last spring? When you calculate whether you can afford to bu and/or maintain a car, you had better include the cost of automobile insurance. Under a new Illinois law that will take effect Jan. 1, liability insurance will become mandatory for all vehicles subject to registration in Illinois.

Mandatory liability insurance is required for all motor vehicles, trailers and semi-trailers except the following: vehicles owned by non-residents of Illinois provided the vehicle is validly registered in the state of residence of the owner and the owner maintains a valid Illinois reciprocity permit as required by the secretary of state; vehicles for which proof of financial responsibility is already required such as vehicles used in the transportation of passengers for hire, rental cars, tow-trucks, etc., vehicles used in husbandry or owned by some governmental agency and inoperable or stored vehicles that are not operated on Illinois highways.

Pursuant to the law, no person shall operate, register or maintain registration of, and no owner shall permit other person to operate, register, or maintain registration of a motor vehicle designed to be used on a public highway and subject to registration unless the operator and the vehicle are covered by liability insurance or bond.

The state law requires you to purchase liability insurance–insurance that will pay third parties for bodily injury and/or property damages that you might cause in driving your car. The minimum insurance required is $20,000 for bodily injury per person, $40,000 for bodily injury per accident and $15,000 for property damages. The law does not require you to purchase insurance to cover loss to your own vehicle, or your own injuries.

Every operator of a motor vehicle subject to the law is required to carry evidence of insurance within the vehicle. Insurance companies are required to issue such a card to each person named insured, and additional cards for household members covered by a policy or bond upon request by the named insured.

Persons convicted of operating a motor vehicle without insurance in violation of the law are subject to a minimum fine of $500. Upon notice of violation, the secretary of state shall also suspend the vehicle registration of the uninsured vehicle for two months and require payment of a $50 reinstatement fee by the owner. In the case of a second or subsequent violation, the vehicle will be suspended for four months, with a $100 reinstatement fee. Operation of a motor vehicle that has been suspended for not being insured is punishable by a minimum fine of $1,000.

Any person who fails to display evidence of insurance upon request by any law enforcement officer is deemed to be operating an uninsured vehicle and is subject to a $500 fine and a two month suspension of the vehicle registration, plus a $50 reinstatement fee. No conviction will enter on this charge provided the person charged produces satisfactory proof in court that the vehicle was insured as of the time of the arrest. (A police officer may not stop your car for the sole purpose of verifying whether the vehicle is insured.)

The law authorizes the Secretary of State to randomly select samples of registrations of vehicles subject to registration in Illinois for the purpose of verifying whether or not they are insured. Testing will be by written request to the owner of the vehicle to supply the name(s) of the insurer, policy numbers, dates of expiration, etc. Upon failure to supply information, the owner will be deemed to be in violation of the law and will be suspended for two months. Submission of false proof of insurance is punishable by a six month suspension and a $200 reinstatement fee.

If you are currently driving a car without insurance, or are thinking of buying a car, you should inquire as soon as possible about the cost of obtaining insurance on your vehicle. While insurance is available to all persons who have a valid drivers license and valid registration, the cost may be prohibitive. Generally, the worse your driving record, the higher your insurance will be. Poor drivers can expect to pay three or four times the rates charged to persons who have excellent driving records. Avoid obligating yourself to years of automobile payments to find out that you cannot afford the cost of insurance.

Don Henderson

Lynn Richards

Students’ Legal Assistance