S.C. controversy erupts over raising auto limits

A controversy has erupted in South Carolina due to Gov. Mark Sanford’s veto of legislation that would have increased auto insurance bodily injury liability limits from $15,000 to $25,000 for one person, and from $30,000 to $50,000 for all persons injured in an auto accident. As a result of Sanford’s veto, the trial bar is pressuring legislators to override the governor, and the Property Casualty Insurers Association of America sides with the governor and is urging lawmakers to reject the trial bar’s efforts.

HB 4622 would also increase property damage limits from $10,000 to $25,000.

Both PCI and the governor noted the trial bar’s role in promoting this legislation. The increase in the limits was an amendment offered on the Senate floor by the president of the South Carolina Trial Lawyers Association.

Sanford vetoed the measure, saying it would increase auto insurance rates, adversely affect low-income drivers and reverse the trend in the decline of uninsured motorists.

PCI cited similar concerns, agreeing that it would increase premiums for many consumers and potentially increase the number of uninsured motorists, while boosting awards for attorneys through higher fees.

Already an option
“This bill will result in many drivers being forced to buy additional insurance coverage whether they want it or not,” said Robert Herlong, PCIvice president and regional manager. “We believe policyholders, not the government, should determine what is an adequate level of coverage. If a motorist wants additional coverage, he or she already has the option to purchase more protection. For some motorist, HB 4622 takes away their ability to make this financial decision and requires them to pay more for their insurance.”

“This increase will hit low income people the hardest,” Herlong said. “Some drivers that have insurance today will be forced to violate the law and drive without insurance because they can’t afford the higher premiums. As the number of uninsured drivers rises, it further increases costs for responsible drivers who have to pay more for uninsured motorist coverage.

“So. although the goal is to protect more people, the end result will be to increase uninsured motorists, put more people at risk, and increase premiums for all drivers,” Herlong said.