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Among other dubious distinctions, Colorado apparently leads the nation in its percentage of uninsured motorists -- 34.8 percent of our drivers don't carry even minimal liability insurance.
Two of our most powerful legislators want to fix this problem by raising registration fees by $1 per car. The money would go to create a new government bureaucracy to operate a computer system that would match vehicle registrations with insurance policies.
The resulting $3 million a year should make work for somebody. The insurance companies will have to send a list of insured vehicles to the state's computer, which will have to match this list to vehicle registrations.
Doubtless the insurers' data will come in all manner of physical formats, ranging from nine-track tape to CD-ROMs, as well as a variety of logical formats -- xBASE, comma-separated ASCII, B-tree EBCDIC.
Getting it all into a standard format might take a month or two, or maybe longer. Not because computers are slow, but because most of the programmers who are good at this stuff are likely to be busy fixing year 2000 problems on other systems. The state is going to have to pay well for their services.
Then the standardized data will have to be matched against the auto registrations to see whether a given car has insurance, and if so, whether the insurance has expired.
This will have to be done frequently, since some sleazy motorist could buy coverage, then cancel the policy a few days later. His policy would still appear to be valid, though, unless the insurer sent frequent updates in a standard format.
After the list is ready, the state will mail warnings to uninsured drivers. Unless they fix things within 45 days, the police could come by and remove the license plates.
But suppose the list isn't quite accurate, and someone with an insurance receipt in hand lost her ability to drive her car on public streets? Just whom would she sue?
This being America, we know she'd sure sue somebody.
So this proposal from the legislature would provide more employment for lawyers, computer programmers and insurance agents. What else is new? Why else do we have a General Assembly?
A better answer to this problem was proposed a few years ago by a state legislator whose name, alas, I have forgotten. Instead of going through all this makework red tape to get every car insured, the state could just raise the gasoline tax, and thereby fund minimum liability insurance for all vehicles on Colorado roads.
In 1993, Coloradans spent an average of $698 per vehicle on insurance. That's high. It was an increase of 18.7 percent from $588 in 1991, when the Consumer Price Index rose only 6 percent in those two years.
It's also a lot more than people in neighboring states paid -- Wyoming was $401, Nebraska $403, Kansas $422, Utah $515.
Anyway, take the $698, apply it to the 3,032,000 vehicles in the state, and that's a total Colorado vehicle insurance expense of about $2 billion. We also buy about 2 billion gallons of gasoline a year, so raising the gas tax by $1 a gallon would fund coverage for all.
Actually, the gas-tax increase wouldn't have to be that high. Some of that average $698 a year goes to collision and other forms of insurance, rather than minimum-liability coverage. And there would be economies of scale -- the state could just put the 3-million-car package out to bid.
So let's figure 50 cents, atop the current 22 cents. Gas would be about $2 a gallon. Those who drove more would pay more, which is fair, and every car on a Colorado road would carry liability insurance, which is what we want.
When this came up before, the opponents argued that it
would reduce personal responsibility, as though Colorado
has an abundance of people who'd think Gee, my rates
won't go up, so I'm going to go out and get in an accident
today.
If Colorado has such morons, the obvious place to fix them is in our educational system, not in our insurance system.
Another argument against it was that it would deprive insurance agents of their commissions from selling auto insurance policies. But if that's unfair, how fair is it to require people to buy insurance from these agents? And wouldn't the agents still be able to sell additional coverage?
Sorry, but any legislature that puts protecting the
income of insurance agents
ahead of protecting the
public from uninsured motorists
is not concerned with
the public interest.
We'll soon learn who carries the biggest stick with the legislature -- 2.7 million Colorado drivers, or about 1,000 insurance agencies in Colorado. And I doubt that anyone will be surprised when the agents prevail.
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