American Property Casualty Insurance Association: Illinois Successfully Launches Electronic Automobile Insurance Verification System

CHICAGO, Illinois, Sept. 30 (TNSOps) -- The American Property Casualty Insurance Association issued the following news release:

Illinois' new electronic insurance verification system has identified more than 2,700 vehicles that did not have the state mandated minimum insurance coverage as of September 2021.

"The Illinois electronic insurance verification system is off to a good start," said Alex Hageli, director, personal auto, electronic issues, specialty lines & counsel for the policy, research & international division for the American Property Casualty Insurance Association (APCIA). "We are pleased to see Illinois go to an electronic online system as part of their effort to reduce the number of uninsured motorists on the streets. This has long been a problem in Illinois and the new system could, by streamlining the insurance verification process, have an impact on costs for motorists."

In the past, Illinois drivers could evade coverage requirements by purchasing insurance to register or renew their vehicle registration, then quickly cancel the policy for a full refund. Now it will be much tougher to go without insurance in the state of Illinois.

Under the old system, the Secretary of State (SOS) would mail postcards to a group of randomly selected registered vehicle owners asking for insurance policy information. This was a manual and paper-intensive process. The Secretary of State's office would then manually confirm coverage with the insurer. The SOS had the power to suspend the vehicle's registration and impose a fine on drivers who failed to return the card or did not provide policy information. Once the driver provided the necessary information, the suspension would be lifted.

The new electronic system will eliminate postcards and conduct the insurance check without the driver being required to act. It will also enable the SOS office to check more registrations in a more efficient and cost-effective manner. When there is not a match between the registered vehicle and insurance, the SOS office will notify the driver and outline the necessary steps to verify there is insurance on the vehicle. To help ensure drivers have proper insurance, the system will verify coverage twice a year.

In 2019, it was estimated that nearly 12 percent of Illinois drivers did not have insurance. According to the Insurance research Council (IRC), insured drivers paid, on average, approximately $78 per insured vehicle in 2016 for insurance protection against at-fault drivers who are uninsured or who have inadequate insurance.