State’s auto insurance rates much too high

Louisiana has the second highest auto insurance rates in the country, and it seems clear that isn’t going to get much better until drivers become more safety conscious and purchase more insurance coverage. The average premium in the state in 2017 was $1,921, much higher than the $1,318 national average. Only Michigan was higher at $2,394.

Premium increases are not as large this year as they have been, but average rates are still going up. By midyear, the state’s auto market had seen a 2.1 increase in rates, which is about half the size of last year’s increase. However, State Farm, the state’s largest auto insurer, has reduced rates for more than a million drivers this year by a combined 4.7 percent.

The state Department of Insurance has set up a task force made up of legislators and insurance industry people to make recommendations on how to lower premiums. However, Jim Donelon, state insurance commissioner, has listed four reasons why the task force has a difficult assignment.

Donelon said premiums have gone up because of an increase in distracted driving, more traffic on the state’s highways, the higher cost of repairs and the high number of court suits filed after accidents. In addition, 14 percent of Louisiana drivers don’t have auto insurance and 40 percent carry only the minimum level of coverage.

Both of those factors result in people who do have adequate coverage subsidizing the costs of accidents involving drivers who don’t have enough insurance coverage.Insure.com notes that Louisiana had the highest auto insurance rates in the country in 2010, 2012 and 2013.

Donelon said, “High auto insurance rates have plagued Louisiana families for years, and while we’ve come up with some Band Aids, we haven’t seen any silver bullet solutions. I’m hopeful that recommendations made by this task force will be successful where previous efforts have failed.”

State Rep. Kirk Talbot, R-River Ridge, chairman of the task force, told The Advocate, “We owe it to Louisiana citizens to try to make insurance in this state affordable.”

That is a mighty tall order, considering the poor track record of so many Louisiana motorists. However, tougher requirements for those learning to drive and tougher penalties for driving violations would be steps in the right direction.

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