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Governor Rejects Alabama Motor Vehicle Safety Responsibility Act Following Letter from NAMIC

INDIANAPOLIS (June 18) - Alabama Gov. Bob Riley blocked legislation to increase the state's auto liability minimum limits, heeding comments made by Liz Reynolds, southeastern state affairs manager for the National Association of Mutual Insurance Companies (NAMIC).

In a letter to the governor last week, Reynolds objected to the fact that the measure would take effect too quickly.

"Signing SB 202 into law without an appropriate time period for implementation will create confusion and chaos for our members and the policyholders they serve," Reynolds wrote. Other trades and companies also were involved in the effort to seek a veto.

The legislation would have required motorists to have at least $25,000 in coverage for one injury or death, $50,000 for multiple injuries or deaths, and $25,000 for property damage. The current requirements are $20,000, $40,000 and $10,000.

The measure was passed without important language that was to be amended into the final version, which would have allowed adequate time for implementing the measure. Without the amendment, the bill would have become law upon the governor's signature, with no consideration for time for reprogramming and filing new rates for the increased coverage limits.

Because of these concerns, Riley did not sign the bill. The governor was quoted as saying he would support the bill in a future legislative session if it included an implementation period for insurance companies to prepare new policies and motorists to buy them.

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For further information, contact
Nancy Grover
(202) 628-1558 Tel
(202) 628-1601 Fax
ngrover@namic.org