At the same time that the District of Columbia introduced a no-fault insurance system, it also made insurance coverage mandatory for all passenger vehicles registered in the District of Columbia.
Both supporters and critics of the measure worried that there would be a nightmare as scores of thousands of uninsured motorists scrambled to buy protection.
But the nightmare never occurred.
Until Oct. 1, 1983, Washington did not require drivers to carry insurance. City Council debates cited Department of Transportation estimates that 40 percent of the District's passenger vehicles -- 100,000 out of 250,000 vehicles -- were uninsured.
The estimates, it turns out, were a myth.
"No one ever really had any idea how many uninsured motorists there were," said Larry Greenberg, chief of the Division of Motor Vehicles. "We always said we didn't know."
Insurance company officials, who believed the estimates, feared a surge in applications by high-risk drivers -- including drivers whose only "risk" was that they had been uninsured for 30 days. Most standard insurance companies will not insure a driver who has been without automobile insurance for a month.
There was an increase, but it was more on the order of 10 percent, said August P. Aleggi, vice president of Government Employees Insurance Co.
Companies that write policies for drivers considered to be high risks did see a large jump in their policies, and an even bigger increase in their premiums; high-risk drivers pay more for insurance than low risks.
Dairyland Insurance Co., which specializes in high-risk drivers, surged from about seventh place to third place in terms of policies written, and to second place in terms of premiums collected. Stonewall Insurance Co., another high-risk insurer, became a major underwriter in 1984.
But the high-risk insurance companies say they are losing money in Washington. Stonewall has stopped doing business in Washington, and Dairyland refuses to write any new policies, although it is renewing current customers' policies.
Edward N. Davis, senior vice president and chief executive officer of Dairyland, said the company's biggest need is an increase in no-fault premiums. Dairyland's difficulties stem from having to base initial no-fault premiums on premiums it charged under the previous liability system; it is expensive to insure high-risk drivers under a no-fault system.
Dairyland, which writes policies for one month at a time, is in negotiations with the Insurance Department seeking an increase.
Some insurance companies said that Dairyland may have written too much high-risk business and should have let some of it go to the assigned risk plan. Drivers who are turned down by insurance companies can appeal to the D.C. Automobile Insurance Plan. The plan then "assigns" these drivers to insurance companies that do business in the District, allocated according to the percentage of business the insurance company does voluntarily in the District.
Motor Vehicle Division chief Greenberg said he believes "most people are complying with the law" requiring them to have insurance.
When car owners register their vehicles, they must certify the name of their insurance company and policy number. It is possible to falsify certification, Greenberg said, but policy numbers are complex and his employes are adept at spotting a falsified number.
If a policy is canceled, the insurance company must notify the Motor Vehicle Division, which sends a notice to the car owner asking evidence that he or she is insured. If there is no response within 15 days, the department sends a notice of proposed suspension. Five days later, the registration is suspended.
Most of the cancellations occur because a car owner switches insurance companies or moves out of Washington, Greenberg said. But his department suspended registration of 3,700 automobiles last year because they were not insured.