Legislators, like sheep, heed the insurance industry

In 2020, Louisiana politicians passed a bill which they touted as a major win for automobile drivers in our state, a promise of lower insurance rates.  Our Republican legislators duped the public into believing that our high auto insurance rates were due to the ridiculously high number of lawsuits filed against insurance companies by the overabundance of accident attorneys in our state.  In response, our esteemed legislators passed a bill that would limit damage suits by people injured in car wrecks. They claimed the bill would make the state’s auto insurance market more competitive and induce auto insurers to pass their cost savings from the bill to consumers.

Surprisingly, Democrats, such as Sen. Jay Luneau, from Alexandria, argued that the real reason for high insurance rates was not because of the numerous lawsuits, but instead due to the fact that insurance companies are allowed to set their rates based upon demographics such as a driver’s gender, age, marital status, or credit score.  He filed bills aimed to prohibit that practice, but they all died in committees.

Democrats in our legislature also raised concerns about the bill because there were no guarantees that insurance companies would actually lower their rates.  They wanted to include a mandate ordering auto insurance companies to lower the rates by 10% to 20%.  The insurance company lobbyists and the Louisiana Association of Business and Industry would have none of that mandate, and so it failed to be included.  Besides, Stephen Waguespack, head of LABI, touted the original bill as the “most important bill of the Legislative session,” so how could our legislators refuse to pass it as originally proposed?  So goes LABI, so goes our legislators.

Additionally, Jim Donelon, our state Insurance Commissioner, who was up for re-election, gave the bill his blessing with promises at the time that it would reduce rates by at least 10% and possibly 25%.

Friday, State Farm, the state’s largest auto insurer, got approval from Donelon and his cronies to raise rates by 4.3% after coming off a banner year of profits due to the limited driving that occurred during the COVID 19 pandemic. Be assured, the other auto insurance companies will follow their lead.

Where are all our legislators now regarding their support of this deception which once again has impacted the wallets of their constituents?  Not a peep from one of the supporters of the bill.  And tragically voters keep re-electing these same folks to Baton Rouge, including the insurance commissioner, and never hold them accountable.  So as you write that increased check for your auto insurance remember who is really to blame, no one but you.