An insurance trade group official said he is urging a Wisconsin lawmaker to revise a pending budget bill that would raise auto insurance coverage requirements.
Andy Franken, president of the Wisconsin Insurance Alliance, said provisions in the bill proposed by Wisconsin Gov. Jim Doyle will increase costs for low- and middle-income drivers.
Despite these predictions by WIA and the Property Casualty Insurers Association of America (PCI), the budget bill was passed by both the Wisconsin Senate and Assembly with the auto insurance coverage increase mandates in place.
The bill is now at the conference committee level, where the two sides must come to an agreement on a unified bill to send to Governor Doyle.
With a June 30 deadline approaching, Mr. Franken takes a realistic attitude about the chances of seeing the budget bill modified.
“There’s a good chance that it’ll stay intact,” he conceded.
However, he’s still attempting to secure some changes to the bill.
“We’re working with members of both the Senate and the Assembly to lessen the effects of the auto insurance provisions,” he related.
Mr. Franken has the support of other industry organization representatives, including Mark Johnston, Midwest state affairs manager for the National Association of Mutual Insurance Companies.
“We’re hoping they would change the bill. As more people see it—especially moderate income motorists—I think it will cause people to think. It’s similar to what happened with gas prices.
“We certainly would like to see the auto insurance drivers taken out of the bill,” Mr. Johnston concluded
According to PCI, 20-to-25 percent of all insured drivers in Wisconsin would be negatively affected by Gov. Doyle’s proposed budget bill.
PCI said that low- and middle-income drivers from northern, western, southwestern and east central Wisconsin counties would receive the highest percentage increases in liability premiums, with those in Milwaukee receiving the highest dollar increases.
NAMIC and PCI said the bill would increase the per person injury level coverage requirement from $50,000 for all persons injured to $300,000. A $25,000 limit for one person would increase to $100,000, and the $10,000 property damage requirement would increase to $25,000.
The groups also announced that the bill would increase the minimum limit on medical payments to $100,000 and make uninsured motorist and underinsured motorist coverage mandatory at $100,000 and $300,000 limits, respectively.
Kimberley Shaul, Wisconsin Deputy Commissioner of Insurance, said at this point the final numbers are uncertain.
Regarding the potential affect of the measure on the cost of premiums, Ms. Shaul said, “In Wisconsin, unlike other states, we don’t approve auto rates. We have a very robust market with over 200 carriers.” She added, “It all depends on the market.”
However, she did admit to the possibility of the mandates increasing insurance rates.
“Yes, that could happen. Market participants set the rates, and we can’t verify anything until the bill is passed,” she said.
Ms. Shaul also shared the reasoning for the proposed higher auto insurance minimums: “Injury limits haven’t been updated in over a decade. The new minimums are designed at consumer protections.”
The insurance provisions would have no actual impact on state spending and revenues.
The conference committee is expected to meet tomorrow.
NU Online News Service, June 23, 3:02 p.m. EDT
An insurance trade group official said he is urging a Wisconsin lawmaker to revise a pending budget bill that would raise auto insurance coverage requirements.
Andy Franken, president of the Wisconsin Insurance Alliance, said provisions in the bill proposed by Wisconsin Gov. Jim Doyle will increase costs for low- and middle-income drivers.
Despite these predictions by WIA and the Property Casualty Insurers Association of America (PCI), the budget bill was passed by both the Wisconsin Senate and Assembly with the auto insurance coverage increase mandates in place.
The bill is now at the conference committee level, where the two sides must come to an agreement on a unified bill to send to Governor Doyle.
With a June 30 deadline approaching, Mr. Franken takes a realistic attitude about the chances of seeing the budget bill modified.
“There’s a good chance that it’ll stay intact,” he conceded.
However, he’s still attempting to secure some changes to the bill.
“We’re working with members of both the Senate and the Assembly to lessen the effects of the auto insurance provisions,” he related.
Mr. Franken has the support of other industry organization representatives, including Mark Johnston, Midwest state affairs manager for the National Association of Mutual Insurance Companies.
“We’re hoping they would change the bill. As more people see it—especially moderate income motorists—I think it will cause people to think. It’s similar to what happened with gas prices.
“We certainly would like to see the auto insurance drivers taken out of the bill,” Mr. Johnston concluded
According to PCI, 20-to-25 percent of all insured drivers in Wisconsin would be negatively affected by Gov. Doyle’s proposed budget bill.
PCI said that low- and middle-income drivers from northern, western, southwestern and east central Wisconsin counties would receive the highest percentage increases in liability premiums, with those in Milwaukee receiving the highest dollar increases.
NAMIC and PCI said the bill would increase the per person injury level coverage requirement from $50,000 for all persons injured to $300,000. A $25,000 limit for one person would increase to $100,000, and the $10,000 property damage requirement would increase to $25,000.
The groups also announced that the bill would increase the minimum limit on medical payments to $100,000 and make uninsured motorist and underinsured motorist coverage mandatory at $100,000 and $300,000 limits, respectively.
Kimberley Shaul, Wisconsin Deputy Commissioner of Insurance, said at this point the final numbers are uncertain.
Regarding the potential affect of the measure on the cost of premiums, Ms. Shaul said, “In Wisconsin, unlike other states, we don’t approve auto rates. We have a very robust market with over 200 carriers.” She added, “It all depends on the market.”
However, she did admit to the possibility of the mandates increasing insurance rates.
“Yes, that could happen. Market participants set the rates, and we can’t verify anything until the bill is passed,” she said.
Ms. Shaul also shared the reasoning for the proposed higher auto insurance minimums: “Injury limits haven’t been updated in over a decade. The new minimums are designed at consumer protections.”
The insurance provisions would have no actual impact on state spending and revenues.
The conference committee is expected to meet tomorrow.
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