The bottom line is that it is another tax increase

Don't be fooled. Penalties that are levied for such things are nothing but a tax in disguise. Furthermore, when levied by agencies that are not accountable to the tax payers and not by our legislature, they are taxation without representation. At least this one is a law passed by the NC Legislature rather than a bureaucrat's fiat.

From WTSB's news page:

Vehicle Insurance Coverage Lapses Will Cost More Starting July 1
Starting Tuesday, July 1, the penalties charged to vehicle owners who habitually drop liability insurance coverage will increase. The change, which results in stiffer penalties for repeated offenses, will affect vehicle owners who have numerous insurance lapses within a three-year period. The new law, passed by the General Assembly in 2007, is the first change in the insurance lapse penalty of $50 since 1957. The new rates will be $50 for no previous lapses within three years, $100 for one previous lapse within three years, and $150 for two or more previous lapses within three years. Insurance companies are required to notify DMV within 20 business days after they issue a new or replacement policy, terminate a policy or reinstate a policy. DMV then sends a letter to the vehicle owner requiring his response within 10 days. Resulting actions are based on the vehicle owner’s response and his record of accidents and financial responsibility. Owners may face a combination of penalties or revocation of vehicle registration.