I saw a commercial during an episode of Jeopardy from the Pennsylvania Insurance Fraud Prevention Authority. It warns people against trying to buy car insurance after an accident — which is illegal and represents insurance fraud. Here is the ad:
The law makes perfect sense — being able to receive an insurance claim settlement without having paid into the system drives up costs for those who have insurance. It also creates incentives to go without insurance until something bad happens.
In a nutshell, higher costs for insurance combined with no penalties for lack of insurance results in more uninsured drivers.
Oddly enough, the same government that polices auto insurance fraud will soon be working to encourage people to buy health insurance after they get sick. The new federal health care law forces insurance companies to cover people who sign up only after becoming ill or injured, and even prevents them from charging these folks more. The result will be higher costs and more uninsured residents.