Lowest levels of insurance May Rise Doyle proposal draws exa

 

Sunday, Mar 08,2009, 10:52:09 PM   Click:

The cost of auto insurance for drivers jumping Wisconsin and some financially stressed consumers probably drop coverage if the provisions in Governor Jim Doyle's budget plan into law, the insurance industry said.

But Doyle and lawyers supported a proposal to increase the minimum coverage of liability for auto policies argue that change is necessary to achieve compliance with the coverage of medical costs that have soared since the current law has been place 28 years ago.

Increased coverage of minimum requirements may sting even more if the legislature decides to make auto insurance mandatory for all motorists Wisconsin. Wisconsin and New Hampshire are the only states that do not require drivers to auto insurance.

Doyle's budget does not propose to change this, but some legislators have tried for more than 70 years ago to require drivers to auto insurance. Although no legislation has yet been presented, the Democrats who now control the Legislature of the State have supported bills to do so.

A provision in the budget of the Doyle - one of many in regard to automobile insurance - should be motorists who purchase insurance of at least $ 100,000 of coverage for injuries to a person, and purchase $ 300,000 of insurance to cover medical payments for accidents in which two or more persons were injured. The current minimum is $ 10,000 per person and $ 50,000 per accident, multiple injuries.

The Doyle also raise the minimum coverage for damage to property from $ 25,000 to $ 10,000 today to increase the minimum non-health insurance medical coverage for the driver or people injured in his car, and to underinsured - insurance.

Wisconsin Insurance Alliance believes the changes proposed by Doyle would force families to pay at least 33% more for auto insurance. Those who can not afford the higher premiums are likely to abandon their cars and without insurance, the industry says trade group.

Approximately 15% of drivers are uninsured Wisconsin, slightly above the national average of 13.8%, according to 2007 estimates from the Insurance Research Council. The alliance is particularly Irked that the proposed changes are part of Doyle's budget and not a separate bill that could be discussed independently of other budgetary matters.

"We are very disappointed that this is the process, the governor and others have chosen," said Andrew J. Franken, chairman of the Wisconsin Insurance Alliance. "We look forward to discuss this openly, a public debate and inform people of the consequences of all these provisions, and in May we get a chance to do it. "

Treatment costs

The proposed amendments provide a more in line with the rising costs of treatment for those injured in accidents, and to provide greater certainty to those who have insurance, "said Doyle spokesperson Carla Vigue. Vigue said the provisions were included in the budget, because they affect the state of health care program Medicaid. Many people who are injured in car accidents can not pay for the cost of treatment for their injuries and are in Medicaid, by pushing the costs to taxpayers, "she says.

It is not known whether the proposal will be part of the forthcoming discussion on the budget of Doyle. The budget of the common writing Finance Committee typically considers elements that have a limited impact on the state budget.

Rep. Mark Pocan (D-Madison), co-chairman, said he and other committee members are awaiting tax legislation Analysis Office of the Governor's proposal before deciding that the non-posts Budget should be removed.

Because the problem affects a large number of people, it deserves a great debate, perhaps outside the budget process, said Rep. David Cullen (D-Milwaukee), who chairs the Insurance Committee of the Assembly.

American Family Insurance, the largest insurer of cars in Wisconsin, said he saw no need to modify current coverage minimums.

"Potentially, this could encourage some motorists to abandon this assurance," said Steve Witmer, spokesman for Madison-American family. "We believe that free market works very well. Our agents talk to their customers about their needs, and we are good customers are decisions that are good for them. "

Allied Insurance

Industry is a faithful ally in Rep. John Nygren (R-Marinette), member of the Assembly Insurance Committee and an insurance agent. He said that many people who already have insurance from more than the minimum coverage requirements, and those who do not struggle to pay for a minimum cover.

"If we can not afford it, just drive more people uninsured," says Nygren. "We are currently one of the states of lower cost for auto insurance, so why we are at the finding with this is beyond me. "

Keith Clifford, a spokesman for the Association for Justice Wisconsin, which represents the state's trial lawyers, said the current coverage minimums are exceeded. Clifford, a personal injury lawyer in Madison, declared a state of neglect minimum drivers do not take into account modern medical expenses, such as the use of MRI equipment and even helicopter flights rescue of accident victims to hospital. The medical treatment which cost $ 25,000 in 1982 $ 104,000 today costs, he said.

The people at fault in an accident must pay for damage they cause and not the cost to victims or taxpayers in the auto insurance coverage is too low, he said.

"There has not been keeping pace with the actual cost of medical expenses and actual losses," says Clifford.

Auto insurers say that the minimum cover over 90% of automobile accidents. In 2007, Wisconsin, personal injury claims averaged $ 16,600 and property damage was about $ 2500, according to Property Casualty Insurers Association of America.

But insurance is not on averages, "said Clifford.

"The purpose behind insurance is to have adequate coverage in case you're in a catastrophic collision," says Clifford.

Meanwhile, lawmakers are again considering legislation to mandate automobile insurance for all drivers.

Senator John Lehman (D-Racine), who sponsored the measures in recent legislative sessions, said that May reintroduce the bill.

Although insurance can have a serious impact on low income drivers, often people who are in accidents have difficulty understanding why other drivers are allowed to travel without insurance, said Lehman.

"Driving is a responsibility, and part of that responsibility is to make sure you are insured," he said.

But the current system has worked, "said Nygren, and insurance could be worse.

"If it is simply driving people to be insured, it does not solve the problem we are trying to correct," he said.