Zurik: Lawmakers expect to address auto insurance issues in next session

NEW ORLEANS (WVUE) - Lawmakers expect to file bills in the next legislative session to address the issue of auto insurance rates in Louisiana being the most expensive in the country.

“We are off the charts in claims to litigation,” Insurance Commissioner Jim Donelon said. “For decades, that has been what has kept us top most expensive state in America for auto insurance.”

The latest numbers published by the National Association of Insurance Commissioners shows Louisiana has the country’s highest auto insurance rates. But when we dig deeper into the numbers, the picture is even bleaker.

“We’re the least affordable in the country when you look at income index versus affordability, we are number one," State Representative Kirk Talbot, R-River Ridge, said. “That to me is the most alarming statistic out there.”

Rep. Talbot chairs the State House Insurance Committee and a recently created task force looking at the high costs of auto insurance in the state.

“We have a large segment of our population that is simply shut out of the auto insurance market,” Rep. Talbot said.

Talbot expects a series of bills to be introduced at the Spring 2019 legislative session in Baton Rouge. He hopes the bills will help reduce the cost to Louisianians.

“What makes us different from other states -- say Alabama, two states away and 32nd cheapest? Or even Mississippi our neighbors to the east?” Rep. Talbot questioned.

One thing that separates Louisiana from the rest of the country is the amount of a jury threshold, or the amount a case must be worth to be put before a jury. If a case falls below the jury threshold, a judge will hear the case.

Talbot said a bill will be introduced to lower that threshold. In the past, similar efforts have failed. Judges have fought against it, claiming it will clog up and slow down the courts.

“It is a workload,” District Judge Robert Morrison said.

According to statistics from the Louisiana Supreme Court, the state had only 173 civil jury trials. Fifty percent of the state’s parishes had no civil jury trials. In 2017, Jefferson Parish had 17 civil jury trials and Orleans Parish led the state with 33 civil jury trials.

Attorneys in Louisiana file more lawsuits than anywhere else we found. In Austin, lawyers file 169 suits per 100,000 people. That number jumps to 234 per 100,000 in Houston and 273 in Dallas. In New Orleans, it’s three times more -- 853 suits per 100,000 people.

Plaintiff attorney Walter Leger said he knows why.

“In Louisiana, when an accident occurs and a person is injured, you have one year to file a lawsuit or its gone, it’s dead, they have no right [to file a lawsuit.],” Leger said. “There are only three states in the country that have a one year statute of limitations. The other 47 have two, three, four or six years.”

Leger said the shorter one year period forces more people to file fearing they could lose out on a claim if their injury worsens.

“In other states you can continue to negotiate with your insurance company or you can at least wait it out until you’ve reached the point of maximum improvement,” Leger said.

Talbot said he agrees with Leger that changes need to be made to the statute of limitations. He said another bill will likely look at who can be sued after a crash.

“We’re one of only two states with direct action where you can sue the insurance company directly,” Rep. Talbot said.

Even with the proposed changes, plaintiff’s attorneys argue no one can predict how much rates would go down if any of these issues is passed in the legislature. Rep. Talbot said there is one way to make that certain.

“Let’s put a mandatory rate reduction in the bill to hold their feet to the fire”

While Louisiana has the highest average rate in the country. The numbers on a local level show the Baton Rouge and New Orleans metro areas pay far more than the state average.

Hover over the map to see how auto insurance rates in your parish compares to the state average. Having trouble seeing the map? Click here to see a full scale version.

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