Earlier this month, Arizona became the latest state to allow electronic proof of insurance. What’s the big deal? While the particulars vary in some instances, the concept is catching on as more states are considering or putting such measures into place.

Arizona’s Electronic Insurance Proof Law

In Arizona, drivers will be able to show their proof of auto insurance electronically, when asked for it by officials. This means the motorists’ policy documents issued by the insurer can be displayed on a smartphone or other wireless communication device as proof of coverage. The law, HB 2677, went into effect August 2, 2012.

Louisiana’s EPI Law is Similar

The language in the Arizona law is similar to that of the electronic proof of insurance law that went into effect August 1 in the state of Louisiana. In the Louisiana law, a mobile electronic device is defined as “any small handheld computing or communications device that has a display screen with touch input or a miniature keyboard.”

Idaho – the First State to Adopt EPI

Idaho pioneered permitting the usage of electronic forms of insurance coverage when its law went into effect July 1, 2012. Idaho Senate Bill S1319 “Amends existing law relating to motor vehicle financial responsibility to provide that a certain certificate or proof of liability insurance may be produced in paper or electronic format and to provide the acceptable electronic formats.”  Acceptable electronic formats include display of electronic images on a cellular phone or any type of portable electronic device.

California: Bill in Process

In California, AB1708 was just approved in the Senate and is headed back to the Assembly for agreement on amendments and then on to Gov. Jerry Brown for final consideration. This puts California on track to be the fourth state in the U.S. with a law that allows motorists to use mobile devices to show proof of auto insurance. Under the proposed bill, motorists would be able to obtain car insurance online or through an agent and display that coverage by means of an electronic device. A motorist could also scan their policy card or auto insurance documents to provide as proof of coverage.

States Allowing Electronic Proof During Registration

Colorado already allows motorists in the state to provide electronic proof of insurance during the vehicle registration process. Alabama will allow electronic formats during registration when that state’s law goes into effect January 1, 2013.

What This Means for You

No more fumbling in your purse, the glove compartment or other storage area in the vehicle should you be pulled over and requested to show a peace officer your vehicle’s proof of insurance. Note that every state except Tennessee and New Hampshire requires drivers to carry proof of liability insurance in the vehicles. With electronic formats increasingly being permitted, this will save the cost of printing and mailing hard-copy proof of insurance coverage and will cut down on the issuance of tickets for failure to produce insurance coverage.

Electronic proof of insurance is a greener way to go, for those consumers concerned about the waste of paper in the environment. But for peace of mind and convenience, being able to show your insurance proof of coverage electronically may be the best benefit.

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