In a Tuesday morning press conference, Gov. Jeff Landry outlined a sweeping plan aimed at tackling Louisiana’s sky-high auto insurance rates.
If the plan comes to fruition in the upcoming regular legislative session, Landry said it will hold both trial lawyers and insurance companies accountable, target frivolous claims and bring greater transparency to the state’s insurance market.
“One of the most pressing issues affecting the budgets of Louisiana families is the cost of insurance. … We passed dozens of bills last year that we were told were going to lead to lower rates, and yet we stand here today seeing very little improvement,” Landry said. “The profits continue to go up while the amount in our citizens’ pockets goes down.”
Landry contended that both aggressive trial lawyers and profit-hungry insurance companies are to blame for Louisiana’s auto insurance crisis. Rather than siding with either, he said he has “pored through the data” to arrive at a reform package that prioritizes consumers first and foremost.
Here’s a breakdown of the changes Landry is proposing.
Limit legal advertising
Landry pledged to support legislation that restricts attorney advertising, which he said fuels a culture of frivolous injury claims.
“Too much of this advertising is having a cultural effect on our society, and it’s not healthy,” he said.
Stop insurance companies from passing advertising costs down to drivers
Under Landry’s plan, insurance companies would no longer be allowed to pass their own marketing costs—think celebrities and talking geckos—onto consumers through higher premiums. He said Texas already bans the practice.
“I’m just as tired of seeing Morris Bart as I am of seeing the lizard,” he said.
Toughen rules on injury claims
Landry wants to reverse a court-imposed law mandating that injuries claimed after an accident are presumed to be caused by that accident. His proposal would require plaintiffs to prove their injuries resulted directly from their accidents, thereby making it more difficult to file frivolous claims.
Strengthen the “No Pay, No Play” law
Currently, Louisiana’s “No Pay, No Play” law prohibits uninsured drivers from claiming damages for the first $15,000 in personal injuries after an accident. Landry wants to raise that figure to $100,000 to further discourage driving without insurance.
Give the insurance commissioner more power
Landry criticized Louisiana’s insurance commissioner as lacking the authority to effectively regulate rates. He wants to give the office powers similar to its counterparts in Alabama, Florida, Mississippi, South Carolina and Texas so the commissioner can better police the practices of insurance companies.
“The data tells us that our insurance commissioner has been unable to hold insurance companies to their word,” he said. “I do not believe that it is personal. I believe that he just does not have the power to be able to do that.”
Demand more transparency from insurance companies
Landry wants to restrict insurance companies from labeling financial data as “confidential and proprietary,” thereby making it more difficult for them to hide key information from consumers and regulators.
Other notable proposals
Landry also wants to ban texting and social media use while driving; limit the ability of undocumented immigrants to benefit from Louisiana’s insurance system; give commercial trucks with dashboard cameras a 5% premium discount; prohibit using credit scores to set rates; and prevent insurance companies from punishing drivers who had a lapse in coverage but weren’t actually driving during that lapse.
The office of Insurance Commissioner Tim Temple tells Daily Report via email that the commissioner is “glad the governor is engaged on this issue.” Temple will announce the package of insurance reform legislation he’s supporting at a press conference Thursday morning.
