La. Senate OKs Bill to Increase Coverage, Costs of Car Insurance

Car insurance requirements in Louisiana would be increased, boosting insurance costs for thousands of drivers who carry the minimum insurance needed, under a bill approved by the Senate recently.

Supporters of the bill by Sen. Mike Michot, said the minimum automobile liability coverage required by current law often doesn’t cover the extent of the damage and is more than 20 years old.

Opponents said the change would raise costs on people who couldn’t afford the increases, would raise the minimum insurance standard beyond the worth of many vehicles and would force more people to drop their insurance coverage altogether, which is illegal.

Louisiana law currently requires car owners to have minimum motor vehicle liability coverage, known as “10-20-10,” with $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.

Michot’s bill would raise that minimum requirement to “25-50-25.”

The Senate passed the bill in a 22-12 vote, sending it to the House for debate.

Michot, R-Lafayette, said only Florida has a lower minimum liability standard than Louisiana. He said the costs of uninsured damaged get passed onto residents in other ways, by medical costs incurred at the charity hospital rather than covered by insurance, for example.

He estimated the costs of increasing coverage would raise his minimum auto insurance premium by $12 a month.

“There’s a certain amount of right and responsibility that comes with owning and operating a vehicle,” Michot said. “Adequate coverage is one of them.”

Sen. Francis Heitmeier said insurance rates of all types had risen dramatically since the 2005 hurricanes and Michot’s bill would add a further burden on people struggling to cover their costs.

“I have a very poor constituency, and to go home and tell them I’ve voted another $100 in premium on them is just something I can’t do in good conscience,” said Sen. Butch Gautreaux, D-Morgan City, who voted against the bill.

Sen. Cleo Fields said Michot’s bill would lead to more people riding around without insurance.

“You can’t expect people to buy something they can’t afford,” said Fields, D-Baton Rouge.

On the Net: S. B. 223 can be found at www.legis.state.la.us

Topics Trends Auto Louisiana Politics