The legislative session’s major lawsuit and auto insurance reform effort passed out of House and Senate Committees on Tuesday night after lengthy debates. The legislation lowers the jury trial threshold from $50,000 to $5,000. House bill sponsor and Chalmette Representative Ray Garofalo says auto insurers have promised rate reductions if it passes.
“They are saying 10% is the minimum that we should expect to see if we implement this bill,” says Garofalo.
Insurance Commissioner Jim Donelon said if the legislation is approved, it will result in a 25% savings in auto insurance rates for Louisiana’s three-million drivers
Proponents believe the legislation will allow the Insurance Commissioner to require auto insurance companies that save money from the reforms to implement a minimum 10% rate reduction.
Garofalo says now is a great time to push for legislation that will put more money back in people’s pockets.
“Because of the health issue it is even more important for us to hear this bill at this point because we have families that are chosing between paying their auto insurance and feeding their families and paying rent,” says Garofalo.
The legislation also extends the prescriptive period for allowing suits to be filed to two years.
Lawyer and former Congressman Don Cazayoux spoke in opposition. He says the changes will pressure victims into settling for less than they deserve by requiring lengthy jury trials.
“The more delay the less chance that that person has to be compensated fully, and the more likely that he or she is going to accept a settlement at an enourmously reduced amount,” says Cazayoux.
Shreveport Representative Sam Jenkins says now is not the right time to take on such impactful and controversial legislation due to travel and Capitol restrictions.
“This bill is not receiving a fair pbulic hearing which it deserves and we are required to do, and we are also leaving the public out, the people who would be effected the most,” says Jenkins.
The twin bills are headed to the House and Senate floors.
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