INDIANAPOLIS (July 19, 2007) - The National Association of Mutual Insurance Companies (NAMIC) congratulated Gov. Kathleen Blanco for vetoing legislation that would have raised the minimum motor vehicle financial responsibility limits. NAMIC had urged the governor to reject the legislation, saying the measure would have hurt many of the drivers of the state’s nearly four-million registered vehicles.
“We had written to Governor Blanco stating that, although Louisiana had some of the lowest limits in the country, it is also one of the 10 most expensive states for auto insurance in the country,” said Tami Stanton, NAMIC’s central region state affairs manager. “Allowing this bill to go into effect would have increased the cost further and could have negatively impacted the insurance marketplace.”
Current law requires car and truck owners to have minimum motor vehicle liability coverage of 10-20-10, meaning $10,000 for damage of other people’s property, $20,000 for injury or death to more than one person in an accident, and $10,000 for injury or death to one person. The legislation would have increased the limits to 25-50-25.
In her veto message, Blanco said that, while the goal of the legislation was important for the improvement of Louisiana’s citizens, the timing of imposing increased liability coverage – in the wake of the 2005 hurricanes and the continuing economic effects – made the legislation less desirable.
“Governor Blanco is to be commended for her decision to veto this legislation,” Stanton said. “Her foresight and understanding of the negative, unintended consequences that surely would result by dramatically raising the limits will prevent many drivers from having to face increasing insurance rates.”
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