Louisiana bill would boost vehicle liability insurance minimums

| 6/6/2007

A bill halfway through the Louisiana Legislature would require drivers in the state to carry more liability insurance. The Senate voted 22-19 May 29 to forward the bill to the House.

Louisiana law now requires automobile policyholders to have at least $10,000 for the property damage of others. They also are required to carry $20,000 coverage for injury or death to more than one person in any one wreck and $10,000 coverage for injury or death to one person.

Sponsored by Sen. Mike Michot, R-Lafayette, the bill would increase the minimum requirements to $25,000 for the property damage of others, $50,000 for everyone killed or injured and up to $25,000 for each person injured.

Supporters of the bill say the current requirements no longer are adequate to cover damages. They were set more than 20 years ago.

Opponents say the change would hurt the state’s low-income residents who wouldn’t be able to afford the increases and cause many people to drop their insurance coverage altogether. They also say the minimum insurance standard would be beyond the worth of many vehicles.

Insurance industry representatives also are opposed to the effort. They say expected higher premiums will only add to the gap between registered vehicles in the state and those that have insurance coverage, The Advocate reported.

State estimates show that of the 3.7 million registered vehicles in the state, insurance companies report that only 2.5 million have coverage.

The bill – SB223 – is in the House Insurance Committee.