Bill to punish auto-insurance evaders moves ahead
Published: Thu, May. 17, 2007 01:25PM
Modified Thu, May. 17, 2007 01:29PM
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closeA legislative bill aimed at deterring out-of-state residents from wrongfully obtaining auto insurance in North Carolina has gained some traction in the General Assembly.
The “rate evasion” bill backed by the state Department of Insurance won the unanimous consent of the House Committee on Insurance this morning. That action pushes the bill to consideration by the entire House.
The bill makes it a felony for out-of-state drivers to fake a North Carolina residence in order to receive lower insurance rates than they could obtain in their home state. It also requires insurance agents to take measures to very the address of applicants.
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Insurance Department spokesman Chrissy Pearson estimates that “thousands, if not tens of thousands” of drivers from states with high auto insurance rates — principally New Jersey and New York — have obtained insurance in North Carolina by supplying fake information. When those drivers have an accident in Asbury Park or Poughkeepsie, it affects the insurance premiums North Carolina drivers pay.
North Carolina’s auto insurance rates are the fifth- or sixth-lowest in the nation, depending on how the rates are calculated.
The bill is sponsored by Rep. Bruce Goforth of Asheville and Rep. Hugh Holliman of Lexington, both Democrats.
Staff David Ranii can be reached at (919) 829-4877 or david.ranii@newsobserver.com.
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