Report finds Louisiana least affordable for auto insurance

| Nov 12, 2018 | Firm News

Louisiana has recently won the distinction of having the least affordable auto insurance in the nation. A report by the Insurance Research Organization found the ratio of expenditures to median household income was the greatest in the nation.

The report found that in 2017, Louisiana’s bodily injury liability claim frequency was double that of the national average.

Louisiana auto coverage

The study also found that Louisiana led the country in hiring attorneys and filing lawsuits after being involved in an auto accident.

One reason for this may be the state’s “fault,” “compulsory coverage” and “pure comparative fault” system for insurance claims

The fault system requires the injured party to prove another driver was at fault so they can recover damages. The compulsory coverage rule prevents one party from claiming the first $15,000 for bodily injury claims and the first $25,000 for property damage claims if the injured party was uninsured.

The pure comparative fault system allows for recovery for any portion of the other driver’s liability. For example, if you are 90 percent at fault in an accident that results in injury or damage, you can still recover for the 10 percent the other driver suffered.

No cap on damages

Louisiana has no cap on personal injury or auto accident cases, although it does impose a one-year time limit on filing a lawsuit in auto accidents.

The National Highway Traffic Safety Administration found that 2016 saw the most hit-and-run fatalities since records began being kept in 1976. Louisiana placed eighth among all the states in hit-and-run crashes, and first among such accidents during rush hour. Most of them occurred during rush-hour congestion.

Louisiana Insurance Commissioner Jim Donelon said several factors are contributing to the increases:

  • Distracted driving has led to more crashes and deaths
  • More people have jobs so more people are on the roads
  • More sophisticated auto parts mean more expensive repairs.

A newly created Louisiana High Auto Rates Task Force was formed by the state and make recommendations.