Full Citation

Title: Driver’s Licenses for Unauthorized Immigrants and Auto Insurance

Citation Type: Working Paper

Publication Year: 2020

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Abstract: Fourteen states and Washington DC allow unauthorized immigrants to obtain driver’s licenses. These policies are called Unauthorized Immigrant License Policies (UILP). The justification for such policies is that doing so may encourage those who are already driving to also get car insurance. For example, New Jersey’s Motor Vehicle Commission argues that allowing undocumented immigrants to obtain licenses encourages them to also get car insurance. Previous studies show that UILP’s are associated with fewer hit-and-run incidents. Others have argued the policies will increase the number of uninsured drivers because immigrants will use their licenses to drive but not obtain insurance. The authors of this paper extend previous research by examining the effects of UILPs on insurance rates. They find that UILP’s are associated with a one percent increase in auto insurance coverage. The study shows that both the number of drivers on the road increases as does the number of insured drivers. This likely means that those unauthorized drivers are receiving licenses and purchasing car insurance. The authors also document increases in the number of insurance claims and an increase in the number of collisions. However, these findings do not translate into more fatalities from car crashes, more severe insurance claims, or higher insurance premiums. Even though the study finds that there are more car crashes, there is not an increase in severe crashes. UILP’s are effective policies that create no unique driving risks. Overall, this study suggests that there is little risk in allowing unauthorized immigrants to obtain driver’s licenses. It finds that unauthorized drivers who are allowed to obtain licenses are more likely to be insured and that additional crashes are generally not severe. Although all driving involves some risk, policies that encourage drivers to get insurance by making it legal for them to obtain a driver’s license are likely to benefit the larger community.

Url: https://www.thecgo.org/research/drivers-licenses-for-unauthorized-immigrants-and-auto-insurance/

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Authors: Churchill, Brandyn; Mackay, Taylor; Yang Tan, Bing

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Publication Number: 2020.009

Institution: The Center for Growth and Opportunity at Utah State University

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Data Collections: IPUMS USA

Topics: Migration and Immigration

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