TRENTON – Senator Joseph Coniglio, D-Bergen, a member of the Senate Budget and Appropriations Committee, issued the following statement today regarding yesterday’s Department of Banking and Insurance (DOBI) Senate budget hearing for FY 2006, and the ongoing efforts to reform the State’s automobile insurance system:
“While I was encouraged by Acting Banking Commissioner Donald Bryan’s testimony today in terms of how far we’ve come, I think we still have far to go to truly provide a fair auto insurance regulatory system which holds good drivers harmless for the mistakes of bad drivers.
Since 2002, New Jersey has enacted laws to improve the auto insurance market, promote competition which benefits insurance customers, and establish a dollar-a-day policy for the Medicaid-eligible drivers who cannot afford more expensive insurance packages. Each of these initiatives has the potential for putting downward pressure on auto insurance rates, but New Jersey’s rates still remain among the highest in the nation.
“I am concerned that good drivers are still subsidizing the bad practices of careless ones. As Commissioner Bryan attested, in New Jersey’s regulatory auto insurance scheme, there is a certain structurally-mandated subsidizing that takes place, but I do not think we can, in good faith, ask drivers with clean records to pay the costs associated with negligent driving.
“Additionally, New Jersey is still fighting the ill effects of uninsured drivers, who put a strain on the entire system. In New Jersey, auto insurance is mandatory, and we have taken pains to ensure that insurance is available to even the most needy, as evidenced by the State’s strong support of the dollar-a-day program. Since its inception, dollar-a-day has brought in 17,000 enrollees who would otherwise be driving uninsured, but there are still many uninsured motorists on our roadways that are driving rates up for everyone.
“I think that we should look at some sort of notification within the State Motor Vehicle Commission, to ensure that no driver can keep a car registered without demonstrating insurance coverage after so many months of registration. With today’s technology, a database and driver tracking is not out of the question, and would be another tool to reduce the number of uninsured drivers.
“I also look forward to working with DOBI to identify and eliminate the most burdensome structural subsidies within the State’s auto insurance system. We need to push for a system that does not unduly penalize drivers with clean records for the bad driving of others.”