Bill Advances to Raise Car Insurance Minimum

By WILL SENTELL

Louisiana motorists would be required to carry more liability insurance under a bill that passed the Senate on Tuesday on a 22-10 vote.

The proposal, Senate Bill 223, next faces action in the House.

Current state law requires motorists to carry at least $10,000 for the property damage of others, $20,000 for everyone hurt in an accident and up to $10,000 per person injured or killed. The coverage is known as 10-20-10.

Under the bill those minimums would rise to $25,000 for the property damage of others, $50,000 for everyone killed or injured and up to $25,000 per person hurt. That coverage is called 25-50- 25.

Sen. Mike Michot, R-Lafayette and sponsor of the plan, said the current, $10,000 maximum for property damage is a problem because that rate was set more than 20 years ago, when an average new car cost $10,606.

The average today, he said, is $21,597.

Higher minimums are needed, Michot said, because responsible drivers whose vehicles are damaged or totaled by motorists with inadequate insurance coverage are penalized. To pay for the repairs, he said, they have to meet deductibles out of their own pocket or rely on their uninsured motorist coverage.

"Ladies and gentlemen of the Senate, I think it is time we tackle this," Michot said. "The minimum coverage is no longer adequate."

Michot said the new rules, if they win final approval, would increase his monthly auto insurance premiums by $12.

Critics said some motorists are unable to afford auto insurance now and higher minimums will make things worse.

"At the end of the day you can't expect people to pay for something they cannot afford," said Sen. Cleo Fields, D-Baton Rouge.

Sen. Francis Heitmeier, D-New Orleans, echoed Fields' concerns. "We have an insurance crisis right now," Heitmeier said. "Rates are going through the roof." He said auto insurance rates are already among the highest in the nation and Michot's bill would boost them another 20 or 25 percent.

Insurance industry representatives are opposed to the measure because they also say it will trigger higher premiums. State officials say that, of the 3.7 million cars and trucks registered in the state, 2.5 million have insurance coverage.

(c) 2007 Advocate; Baton Rouge, La.. Provided by ProQuest Information and Learning. All rights Reserved.