Louisiana House OKs Car Insurance Hike

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Louisiana’s House of Representatives voted May 19 to raise the minimum level of required automobile insurance, an increase that would mean higher insurance costs for over 1 million motorists.

Supporters of raising the insurance minimum said the state’s current minimum levels were set in the early 1980s, when health insurance and automobile costs were far lower. The bill’s sponsor, Rep. Erich Ponti, said Louisiana has the lowest minimums in the nation.

Opponents said residents should not face higher insurance costs at a time of rising food and fuel prices. Rep. Mert Smiley said he thought the increase would cause motorists to drop insurance altogether, to avoid paying the higher fees.

The House approved HB 1312 by a vote of 57-33, sending it to the Senate. The Legislature passed the same change last year, but it was vetoed by then-Gov. Kathleen Blanco. Gov. Bobby Jindal has not taken a public stand on the bill. His spokeswoman, Melissa Sellers, did not immediately respond for comment.

State law now requires car and truck owners to have “10-20-10” minimum motor vehicle liability coverage: $10,000 coverage for damage of other people’s property, $20,000 coverage for injury or death to more than one person in an accident and $10,000 coverage for injury or death to one person. The bill by Ponti, R-Baton Rouge, would raise the minimum to “25-50-25.”

Ponti said the change would lead to lower payments for those who carry more than the minimum insurance coverage. He recommended that motorists facing higher costs could save money by raising their deductible from $500 to $1,000. He estimated most affected motorists would face cost increases of no more than 10 percent.