Sen. Gary Smith, D-Norco | Louisiana Legislature
Sen. Gary Smith, D-Norco, has pre-filed SB 71, a plan to create a better public option alternative for vehicle insurance in Louisiana.
Smith’s bill expands and updates the Louisiana Automotive Insurance Plan (PLAN), an under-used state option for applicants who cannot, in good faith, obtain a regular insurance plan for private passenger motor vehicles or commercial vehicles or garage liability policies.
Jeff Albright, CEO of the Independent Insurance Agents and Brokers of Louisiana, told the Record that he had not seen Sen. Smith’s bill, though he does not think the new legislation will be significant.
“Louisiana already has an automobile insurer of last resort--the Louisiana Automotive Insurance Plan (LAIP)," Albright said. “I know that the Louisiana Insurance Commission had intended to introduce a bill to do a little reorganization of the LAIP. I do not expect it to be significant."
Attempts to reach Warren Bird, the Louisiana deputy insurance commissioner for property casualty insurance, were unsuccessful.
Smith was out of the office when contacted for comment.
A copy of SB 71 is posted on the Louisiana legislature’s website. SB 71
The bill is a reworking of the original LAIP law, which has been in effect for a number of years.
“Until recently, they (LAIP) hadn’t written many policies,” Albright said, but that seems to be changing. “They are starting to write a few policies because the market has been so difficult,” he said.
In Smith’s proposed update, the term “assigned risk” in the original law is crossed out. The intention of the legislation is stated:
“Proposed law creates a Personal Automobile Insurance Procedure (PAIP) to do the following:
- Cause to be issued policies of private passenger automobile insurance in the Plan's name to eligible applicants, and to provide policyholder and claim handling services.
- Allocate the operating results of the PAIP, profit or loss, to those subscribers that write private passenger motor vehicle insurance.
There is similar language for a commercial vehicle option.
Albright believes the reworking of a policy of last resort is not what Louisiana needs. He says the LAIP was never intended to be a price competitive option compared to the private market, he says.
His advice for someone who is having a hard time finding a policy: “Talk to a couple of good independent insurance agents and let them shop around and do the best they can for you.”