At least one cash-strapped state -- South Carolina -- is tackling its budget crisis in a novel way: A recently introduced bill there would vacuum cash from the wallets of motorists worried their lead-footed ways may result in hefty car insurance premium hikes.
Bill 3157, introduced this year in the South Carolina legislature, proposes that for violations for speeding less than 10 mph above the limit, motorists would have a choice of receiving a traditional ticket of up to $25 or a $150 warning ticket. That warning ticket would be issued with the assurance it would not be reported to the South Carolina Department of Motor Vehicles, and thus would not result in points being levied on their driver's licenses.
In essence, drivers would shell out many times the cost of a ticket to hide the infraction from their insurers.
Why spend $150 to dodge a $25 bill? Because a single moving violation might cost you a safe-driver discount, and a second might bring a surcharge that lasts for years. A third or fourth might put your license in jeopardy.
But a single ticket might not even matter at all.
Insurers call their own shots
In South Carolina, a uniform rating merit plan was discontinued more than 10 years ago. Until its discontinuation, specific moving violations brought about corresponding increases in premiums, no matter which insurer a driver had.
Today, insurers decide individually how to penalize drivers, says Russ Dubisky, executive director of the South Carolina Insurance News Service in Columbia, S.C.
Speeding tickets on a driving record are an indicator of risk for some insurers, Dubisky says. But other companies may not weigh a speeding ticket as heavily. "Because driving record is just one of the factors brought in when determining rate, it may or may not have an impact," he adds.
Your particular vehicle, credit, neighborhood and even occupation also can influence your auto insurance quotes.
"Something might matter to one company, and to another it might not make any difference. ... It doesn't mean that just because you get a speeding ticket your rates will go up."
It's not a speeding strategy
But that doesn't mean the $150 "warning ticket" is a license to speed.
Let's assume the bill does pass and South Carolina institutes a program of $150 warning tickets. In what instances would choosing the warning ticket be more cost-effective than paying the increased car insurance rates resulting from the infraction? That question is next to impossible to answer, Dubisky reports.
"Our response is, first, we encourage every driver to obey speed limits," he says. "And secondly, there's no way of knowing if a speeding ticket will impact your individual insurance premium.
"Insurance companies use a number of factors in their rate-making process these days, including age, experience, claims history, where they drive and whether that driving is urban or rural," Dubisky says.
"We're concerned with being able to match rate to risk. And in South Carolina we have that ability, because our companies can file their own rating plans."
And while some may not penalize a single infraction, none of them will ignore multiple visits to the county courthouse.
As of early April, Bill 5137 was still in committee.