The growing number of uninsured drivers on US roads is driving up auto insurance costs for all motorists, according to a new report from Mercury Insurance.
A study from the Insurance Research Council found that between 2019 and 2022, the percentage of uninsured drivers rose from 11% to 14%, meaning that approximately one in seven drivers lacks coverage.
According to Bankrate, the average cost of full coverage auto insurance stood at approximately $205 per month as of November 2024. In response to the rise in uninsured drivers, insurers have been forced to offset costs by increasing premiums for all policyholders. Collectively, insured motorists paid $16 billion for uninsured and underinsured motorist coverage in recent years, according to Answer Financial.
Kevin Quinn, vice president of auto claims at Mercury Insurance, explained that uninsured drivers affect both insurers and responsible motorists.
“The reality is we all bear the burden for motorists who drive without auto insurance, and it’s tough on both the insurer and insured,” Quinn said. “We understand that affordability is a problem, but driving without insurance not only creates a significant liability for the driver, it also exacerbates the affordability problem for everyone.”
Mercury Insurance, headquartered in Los Angeles, offers personal auto, homeowners, and renters insurance in several states through independent agents. The firm outlined several ways uninsured drivers impact insurance rates. When more drivers are uninsured, insurance companies face increased risk because they must cover more accident-related costs. As a result, insurers raise rates for all policyholders, even those with clean records, to compensate for the financial impact.
While many states require uninsured motorist coverage to protect insured drivers, frequent claims related to uninsured drivers still contribute to overall premium increases. Additionally, those caught driving without insurance may face severe penalties, including significantly higher future insurance rates due to being classified as high-risk drivers.
Mercury Insurance recommends some steps to mitigate financial risk from uninsured drivers. Carrying uninsured or underinsured motorist coverage, if not already included in a policy, can provide protection in accidents involving uninsured drivers. An umbrella policy offers additional liability coverage beyond standard limits, though policyholders should verify whether it covers uninsured motorists. Finally, practicing safe driving habits by staying alert and minimizing distractions can help drivers avoid accidents and the potential financial consequences of encountering an uninsured motorist.
“Auto insurance is not just a legal requirement—it’s a safety net that protects you, your passengers, and others on the road,” Quinn said. “If affordability is a concern, there are several discounts and strategies that consumers can take advantage of to help reduce costs.”
Mercury Insurance has an “A” rating from A.M. Best., recognized for its rates and customer service.
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