According to Fox News, lawmakers in Louisiana are likely to address the topic of auto insurance rates in the upcoming legislative session, as the state now has the highest rates in the U.S.
Louisiana is the country's least affordable state in terms the ratio between auto insurance and income rates, making it difficult for for many residents to maintain coverage. Louisiana Lawsuit Abuse Watch (LLAW) believes that the present litigation culture is behind the exorbitant costs, as accident rates in Louisiana are nearly on-par with national averages.
"Even though the number of accidents in Louisiana is only slightly higher than the national average and the number of general accident claims is in line with the national average, Louisiana drivers are two times more likely to file auto-injury claims," Lana Sonnier Venable, executive director of LLAW, told Louisiana Record.
Lana Venable
| Courtesy of LLAW
Venable said that since about 53 percent of Louisiana drivers are unable to afford insurance coverage, many are uninsured or underinsured, and will turn to the court system in order to get larger payouts when they are involved in an accident.
"These are not just statistics – they illustrate the real impact of lawsuit abuse on both consumers and businesses," Venable said. "Louisiana’s litigious environment makes it difficult to obtain and maintain insurance at competitive rates. Not only are our existing businesses feeling the effects, but those looking to locate or expand here are taking note."
Louisiana enforces a relatively short one-year statute of limitations to file a lawsuit for an auto accident, which may push some individuals to file abruptly. Many other states allow longer periods, from two to six years in some cases. The abbreviated timeframe means less time to work with insurance companies and, therefore, more extreme settlements – aka quick payouts.
"It is critical to address the onslaught of 'jackpot justice' advertised across the Pelican State," Venable said. "We should be focusing on expanding business and industry – not reinforcing a culture of lawsuits."