It seems wrong. You or your insurance company are able to take legal action against the driver for their actions if they were at-fault. The state should suspend the car's registration and it should no longer be on the road until resolved.

Illinois law requires that all motor vehicles operated in Illinois must be covered by Liability insurance. Section 7-601 of the Vehicle Code of the Illinois Compiled Statutes (ILCS) gives information on required Liability policy by stating in subsection (a) that no person shall operate, register or maintain registration of, and no owner shall permit another person to operate, register or maintain registration of, a motor vehicle designed to be used on a public highway unless the motor vehicle is covered by a liability insurance policy. This is found under ILSC 625/5 Chapter 7 if you want to read through the whole statute.

Vehicle owners are required to provide insurance information at the time of registration renewal. Once the vehicle owner signs the registration or renewal application, he or she affirms the vehicle is properly insured. So proof of insurance is supposed to be required in IL to register and maintain registration on your vehicle.

Section 7-604 talks about how the Illinois Secretary of State (SOS) verifies that car owners have Liability insurance on their vehicles. They do so by selecting random samples of registrations of motor vehicles subject to Section 7‑601 of this Code to determine whether or not the motor vehicles are insured. The IL Department of Transportation also notifies the SOS of the name of any owner or operator involved in an accident so the SOS can verify whether or not at the time of the accident such motor vehicle was covered by a liability insurance policy in accordance with Section 7‑601 of the IL Code.

The next section of law (7-605) than states the if the SOS determines that an owner has registered or maintained the registration of a motor vehicle without the mandatory Liability insurance policy the owner will be notified that their registration will be suspended.

When it is a first time violation of the Illinois insurance law the SOS will terminate the suspension upon payment by the owner of a reinstatement fee of $100 and submission of proof of insurance as prescribed by the SOS. If it is a second or subsequent violation by a person having ownership interest in a motor vehicle or vehicles within the preceding 4 years the SOS shall terminate the suspension 4 months after its effective date upon payment by the owner of a reinstatement fee of $100 and submission of proof of insurance as prescribed by the SOS.

So there are laws in place that should, at least now after the accident if the uninsured owner/driver was not caught before the incident, suspend the car's registration. Illinois is not like some other states where the insurance company automatically informs the state when a person cancels or has a lapse in insurance. Illinois does require there be insurance in place for registration but then basically rely on the person to keep that in place and catch some of those who do not with their random checks.

There are also penalties that the other driver that hit you should face for driving without insurance. The typical penalty for a first offense of driving without insurance in Illinois is a $500 fine and a 60 day suspension of their registration. Repeat offenders face a 4 month suspension. A $100 reinstatement fee and proof of insurance is required for the person to get their plates back. The minimum fine for driving a car with suspended registration is $1,000.

So the person that hit you should be facing registration suspension and fines at least. Also since you had to put the claim through your own insurance company for the damages they caused you than your insurance company will likely subrogate with them and thus request they pay for the monies your insurer put out for your claim.

You can ask your claims adjuster if they are going to do this and if they will also be trying to recoup your $500 deductible amount. If so than you may have to wait some time but hopefully get the deductible amount back, if not than you may see about suing the driver personally in court for your deductible amount, rental car or other expenses that you are out and can sue for due to this person causing the accident and not having insurance to cover it.

If you and/or your insurance company get a judgment against the uninsured motorist than the state of Illinois may suspend the person's driver's license, registration certificates, license plates and registration stickers if they fail to satisfy the judgment(s). ILCS 625/5 Section 7-303 notes that the SOS shall suspend the driver's license upon receiving an authenticated report that the person has failed for a period of 30 days to satisfy any final judgment and shall also suspend all registration certificates, license plates and registration stickers issued to the person named as the judgment debtor in any such authenticated report.

Judgment here was defined here as meaning a final judgment of any court of competent jurisdiction of any State, against a person as defendant for damages on account of bodily injury to or death of any person or damages to property resulting from the operation, on and after July 12, 1938, of any motor vehicle.

While in some states if a person is found driving without insurance the vehicle is impounded Illinois does not list this as a penalty and though it seems odd to us as it must to you, police then just ticket the person for the insurance violation and let them drive away in their uninsured car. You can always contact the IL legislature about your concerns how an uninsured driver is allowed to drive away after being cited for this offense.