Where the rubber hits the road 

Everyone could be at risk if the recession causes more drivers to go uninsured

  • Courtesy Insurance Research Council

Perhaps the greatest lesson of the recession is that yes, it is your problem.

Overpaid bank CEOs' failure to make decent investments. Macy's inability to sell enough Coach handbags. Widespread distrust of Chevys. It all spells trouble for you, as it turns out.

So does January's 8.1 percent unemployment rate in Colorado Springs, up from 5.5 percent a year before. That means those 25,000-plus out-of-work people locally have less money. And that means you'd better watch your ass on the road.


"I think the important thing we found is, with an increase in unemployment, you should expect an increase in the number of uninsured motorists," says David Corum, spokesman for the Insurance Research Council.

Though the effects likely vary state to state, a study released this year by the IRC found that nationally, an increase in the unemployment rate of 1 percent directly linked to a leap of more than three-quarters of a percentage point in the rate of uninsured drivers.

Now consider your odds. Before the downturn, in 2007, the IRC estimated that 15 percent of Colorado drivers were uninsured. (The state's Department of Revenue, which uses a different system, estimated more than 12 percent were uninsured in September 2008.)

Also consider this: Many of us don't even realize that we may not be covered if hit by an uninsured motorist. Sudden victim

"The accident happened January 31, of last year," Linda Meinecke says. "He was on his way to work; he had to work the opening shift at the PX on Fort Carson."

He left at 2 a.m. She got the call from Memorial Hospital at 4 a.m., just as she was about to leave for work.

Meinecke's husband, Michael, didn't die that day on Colorado Highway 115. He died later, at the hospital, after his health deteriorated due to his broken neck and concussion.

After being married to him for 28 years, Meinecke, 64, still gets her verbiage confused when she refers to her husband. He is a good provider. Not was.

But Meinecke didn't just lose her husband that day. She also lost her security.

The woman who slammed into her husband's truck was drunk, using fake tags and uninsured. Meinecke's only saving grace was her uninsured and underinsured drivers insurance, a relatively inexpensive add-on to traditional car insurance that pays for your medical bills and personal loss if someone without insurance hits your car.

For Meinecke, it meant a financial settlement. Not enough to provide security in her retirement, but enough to scrape by, when combined with a meager income from her job.

"That little money I've got, has got to last me the rest of my life," she says. "I'd give all that money back if he would be here."

Unfortunately, says her local attorney Mike McDivitt, Meinecke's story is common. But, unlike Meinecke, not everyone who gets hit by an uninsured driver has insurance to cover their losses. In fact, many people who think they have "full coverage" won't see a dime for their medical bills if an uninsured driver hits them.

"I think the important thing is that the public knows that we've had this problem for years," McDivitt says. "They need to get specific explanation from their agent of what their insurance includes."

Is it hitting here?

Clients are reviewing their insurance renewal forms, searching for errors or options that could save them money. Many are raising their deductibles to lower their bills. Others are paying late, and then asking not to be charged late fees. But several local insurance agents say people seem to be holding onto their insurance.

"I think it's a security factor and a little piece of mind," says Brad Hilliard, spokesman for Colorado State Farm Insurance offices, "so I think that's one of the last things they get rid of when push comes to shove."

But David McDivitt, Mike McDivitt's son and a personal injury attorney at his law firm, says an increase is likely on the way.

"Now's the time to plan for the other guy," he says. "[Uninsured motorist insurance] is an inexpensive way to make sure the recession doesn't turn around and bite you because it's bitten someone else."

Even if the guy who wrecks your car has insurance, his coverage may be insufficient to pay for your personal injuries or damage to your property. Colorado only requires drivers to carry enough insurance to cover $25,000 per person for bodily injury ($50,000 maximum per accident for bodily injury), and $15,000 for property damage. It's likely your own uninsured and underinsured driver insurance would make up the difference if damages are more severe.

By the way, says Colorado Springs police Lt. Steve Tobias, if the number of uninsured drivers does increase, responsible drivers could end up with dangerous hits to more than their pocketbooks.

"We sometimes see increases in hit-and-runs," Tobias says, "because the person without insurance [doesn't want to] be identified."



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