House Insurance Committee Kill Effort To Lower Auto Insurance Rates
Published 9:37 am Tuesday, May 17, 2022
Getting your Trinity Audio player ready...
|
Last week the Louisiana House Insurance Committee killed Rep. Edmond Jordan’s House Bill 351, a bill to lower auto insurance rates by banning the use of credit score and occupation rate-setting.
Insurance Committee Chairman Mike Huval and Representatives Mary Dubuisson, Kathy Edmonston, Gave Firment, Larry Frieman, Paul Hollis and John Illg all voted against the bill to lower auto insurance rates. Representatives Edmond Jordan, Delisha Boyd, Chad Brown, Cedric Glover, Kyle Green, Sherman Mack, and Matt Willard all voted in favor. Because the vote was a 7-7 tie, the bill failed to advance out of committee.
Insurers use non-driving factors like credit score and occupation to overcharge good drivers and give discounts to wealthy customers that they think might purchase other kinds of insurance, like homeowner’s, life and boat insurance.
In many instances, your credit score is actually more important than your driving record. Consumer Reports magazine found that a Louisianan with poor credit but a perfect driving record pays nearly $1,000 more per year than a Louisianan with excellent credit and a DWI conviction.
As a result, good drivers with poor credit or blue-collar jobs get hit with big penalties, disincentivizing good driving and resulting in nearly half of Louisianans being forced to go uninsured or underinsured, which damages the health of the insurance market and raises everyone’s rates.
Shamefully but unsurprisingly, Louisiana Insurance Commissioner Jim Donelon joined insurance lobbyists in testifying against the bill, despite raising the issue of Louisiana’s large number of uninsured and underinsured drivers himself many times in the past. The Commissioner has consistently sided with the insurance industry, with few exceptions.
After House Bill 351 failed, another effort to lower auto rates was also defeated on a tie vote. Rep. Robby Carter’s House Bill 116, which would have stopped insurance companies from charging policyholders for their advertising in their base insurance rates, was voted down by Chairman Huval and Representatives Dubuisson, Edmonston, Firment, Hollis and Illg. Insurance company advertisements are nearly unavoidable, and Louisiana allows these big corporations to charge our drivers for those billions of dollars’ worth of ads.
See below for a statement from Real Reform Louisiana Executive Director Eric Holl:
“Louisiana has the highest auto insurance rates in the country, but our legislators continue to let the big insurance companies write our insurance laws. The corporate lobbyists and insurance commissioner told us that tort reform would lower our rates by 25%, but our rates keep going up while insurance companies rake in billions in profits. Despite opposition from Chairman Huval, the insurance commissioner, and so many members of the Insurance Committee, we will never stop fighting for real auto insurance reform that will lower rates.”