States vary considerably in their rules on auto insurance, including in what types of coverage they require drivers to have. There are many different auto insurance coverage types. Today's post will be focused on one such type: uninsured motorist property damage (UMPD) coverage.
UMPD insurance is generally aimed at covering property damage a driver suffers as a result of an accident caused by a motorist who doesn't have insurance or is underinsured. Some states require drivers to have UMPD coverage, while others don't even require such coverage to be offered.
Where does Louisiana fall on this continuum? Louisiana does not require UMPD coverage. It does, however, require insurers to offer this sort of coverage to motorists.
Louisiana also has rules regarding how much damage UMPD insurance has to cover. Under state law, such insurance has to cover at least up to $25,000 worth of damage. This requirement is much larger than the requirement for some other states. For example, Louisiana's coverage amount requirement is over seven times higher than the requirement in California.
State auto insurance laws, like laws on UMPD, can have very big impacts on what auto insurance policies look like in a state, which in turn can have major impacts on insurance companies.
This is not the only way state laws can impact auto insurance companies. State laws can also have big impacts on what rules and process are involved when a company is facing litigation from a policyholder. As with rules on auto insurance policies, rules on insurance litigation vary significantly from state to state. Thus, when facing a legal dispute with a policyholder here in Louisiana, such as a dispute over a UMPD claim, an insurance company may want guidance from a lawyer with a deep knowledge of the particulars of Louisiana insurance law.
Source: NerdWallet, "Understanding Uninsured Motorist Property Damage Insurance," Aubrey Cohen, Jan. 5, 2016