An Update – HB229
PIA of Louisiana is pleased to report that HB229 by Rep. Huval, which provides with respect to the use of a wireless telecommunications device while operating a motor vehicle, advanced out of Committee on Transportation, Highways and Public Works yesterday by a vote of 13 to 2, with amendments. The next stop for this bill is the House Floor. Please watch for forthcoming PIA Action Alerts – we will reach out to you when it is time to contact Representatives to encourage their support of HB229 on the House Floor.
What’s Next – HB372
HB372, The Omnibus Premium Reduction Act of 2019 by Rep. Talbot, which advanced from the House Floor (with 32 co-sponsors!), will soon be heard in Senate Judiciary A. The bill has not been put on the calendar yet, but as soon as it is posted we will disseminate a PIA Action Alert to remind you to contact your Senator on Jud A to encourage their support of HB372. Please watch for this important correspondence from PIA as we anticipate advancement of HB372 will be a fight. This is critical and we need everyone’s help!
Please be sure to make clients and colleagues aware of this very important legislation which has been dubbed by many groups as the most important bill in the legislature this session so that they, too, may contact legislators at the appropriate time. If you have a personal relationship with your Senator, please reach out with a personal message in support of HB372. Talking points in support of the bill are outlined below, and the push card is below– pass it on!
In the meantime, if your Senator sits on Jud A, or you have a relationship with a Senator on Jud A, please do not hesitate to contact them directly to encourage support of HB372. Jud A Committee Members are listed below:
Senator Rick Ward, III (Chairman)
3741 Highway 1
Port Allen, LA 70767
Senator Jay Luneau (Vice-Chairman)
711 Washington Street
Alexandria, LA 71301
Senator John Milkovich
656 Jordan Street
Shreveport, LA 71101
Senator Jack Donahue
P.O. Box 896
Mandeville, LA 70470
Senator Ryan Gatti
2123 Shed Road
Bossier City, LA 71111
Senator Daniel "Danny" Martiny
131 Airline Drive
Metairie, LA 70001
Senator Wesley Bishop
7240 Crowder Blvd.
New Orleans, LA 70127
About HB372 – The Need
Louisiana has the second highest auto insurance rates in the nation. It has become so bad, that some businesses, such as school bus operations, logging, and other businesses with commercial trucks can no longer afford insurance. They are either going out of business or leaving the state. Some businesses are paying as much as $30,000 a year for each truck. On the personal auto side, Louisiana ranks No. 1 in the nation as being the least affordable, beating the next closest state by a wide margin. In short, something has to be done, now.
In the 2018 LA Regular Session, Senator Bishop moved legislatively to form a task force to study the cause of these high rates, and to make recommendations to fix the problem.
Representative Talbot co-chaired the committee with Senator Bishop, and a bill comprised of 5 items was put together. That bill - HB372 The Omnibus Premium Reduction Act of 2019 - has already passed the Civil Law committee as well as the House of Representatives. It now goes to the Senate Judiciary A committee for consideration. PIA will notify you as soon as the bill is on the committee agenda.
HB372 – The Objectives
Lower the jury trial threshold to $5,0000 - Louisiana has the highest threshold in the nation, by far. The next closest state is Maryland, at $15,000. 36 states do not have a threshold at all. Right now, cases valued at under $50,000 are heard before judges, with no jury. However, it has been shown that the prospect of having to prove a case before a jury, along with the cost involved, as well as the time it takes to go through the jury trial process, has a chilling effect on litigation and actually results in far fewer trials. Cases get settled.
Abolish the Direct Action Statute - In most states, the mere mention of insurance is cause for a mistrial. Here, insurance takes center stage. Just ask yourself: What does the existence of insurance have to do with who caused the accident and how much should be awarded as damages? This change will take the issue of insurance out of the equation. Cases will be decided based upon the merits of the case, not based upon if there is insurance available to pay any judgment.
Extend the 1 year prescription period to 2 years. Right now, suit must be filed within a year of an accident. If a party that is hurt is not in a position to settle the claim, suit must be filed. Once the claim is turned over the insurance company defense counsel to litigate, the claim drags out, becomes more costly, and adjusters tend to abdicate handling to defend counsel. Extending the prescription period to 2 years will allow most claims to be resolved without litigation. Right now Louisiana ranks near the top of all states for the number of lawsuits per person.
Fix the Collateral Source Rule - Right now, if a medical provider bills (for example) $10,000 for a procedure, but has agreed to accept $2,500 from the health insurer, the full $10,000 still goes before the jury as damages, whereas the cost was only $2,500. This would modify the rule so that only the actual amount the patient or his insurer incurred can be claimed. Persons should not be allowed to game the system or to profit by claiming these phantom damages.
A mandatory rate review for all insurers for three years. Once these changes are implemented, this will allow the Department of Insurance to monitor insurer rates, to required rate reductions as insurers return to profitability. This is just a method to ensure the savings are passed along to the consumer.
Thank you PIA Members for your strong grassroots efforts for the benefit of the Louisiana insurance consumer and the general health of the insurance industry in our state! If you have any questions about either of these bills, or any of the bills in the session this year, please do not hesitate to contact a PIA Governmental Affairs Committee Member, Natalie Cooper or myself. Thank you for your support to your association and our industry!
Don't want to wait on the Bill in order to cut your insurance rates?