It is thought that 1 out of every 5 people on British roads are drive without insurance. This means that if you are involved in an accident with a person with no insurance, you will not be able to recover any costs if it was their fault. Those who are currently driving are probably not aware that driving without insurance is illegal. Those who are aware obviously aren't deterred by the punishments that have been devised by the government.
The minimum punishment that you will receive for driving without insurance is a £180 fine and 6 points on your licence- a small price to pay if found out as opposed to paying an annual insurance premium. More serious punishments include a ban from driving altogether, which reinforces the message that driving without insurance is completely unacceptable.
People are perhaps more inclined to driving without insurance due to the current economic recession, which is taking its toll on many people's pockets. Another reason could be because the cost of car insurance seems to be forever increasing. More people are making fraudulent claims than ever before, and the number of accidents is not decreasing. This means that insurance companies are being forced to put up their car insurance premiums, as fraudulent claims and accident increases can be catastrophic for their balance sheets.
It is also more expensive to pay your car insurance premium monthly than it is by direct debit. Car insurance companies see monthly payments as a form of borrowing, so are likely to slap a high percentage of APR to anyone who doesn't pay their premium in full, in advance. This will encourage those who can't afford an upfront payment to not take out insurance at all, as they will be paying over the odds as opposed to those who can pay in advance.