What are the legal risks associated with a business or organization that provides insurance for fare dodging?

Question

I'm wondering about the legality of a system like planka.nu (Swedish subway fare dodgers) (More info here: NPR article and Planka.nu site) as they would be implemented in the USA. Is there any law or regulation that might restrict or prevent the formation or operation of a cooperative that charged a fee in exchange for agreeing to cover the fines associated with summary offenses?

Answer 1

The bigger concern would be economic. Most insurance policies don't cover any kinds of intentional acts, because compensating someone for a loss that they intentional bring into being when you only have to pay for insurance when you plan on intentionally incurring liability is usually a horrible business model. It creates a moral hazard on the part of the insured.

Sometimes policies like director and officer insurance will cover intentional act risks because the determination of whether an act is illegal is so uncertain that there is real uncertainty involved to insure against. But, there is no ambiguity about what is and is not illegal fare dodging.

Also, even if the system did work for a while, it would have to receive approval from state insurance regulators, who would probably decline to grant approval in this scheme, and it could also almost certainly be invalidated by a local government ordinance if it became a problem.

I don't agree that compensating someone for fines automatically makes someone an accessory to a crime (similarly, there are private organizations that pay bail for people accused of crimes, or help people avoid de facto debtor's prison by paying off minor fines that the debtor can't afford). Indeed, entities sometimes have insurance policies that compensate them when their employees, against company policy, commit crimes and incur fines. But, there are lots of legal barriers to the scheme proposed, and I doubt that it would work.

Answer 2

Yes. Assuming fare evasion is an offence, being an accessory to fare evasion is also an offence.