With an influx of new Republican members of the Legislature, business interests backing changes to insurance litigation seemed poised to make major alterations to the law — with the goal of reducing lawsuit costs on car insurance.
At second highest in the nation, Louisiana needs to cut costs of car insurance.
But for all the head of steam for business interests, significant other players had their say in the legislative process. Not least among them is Gov. John Bel Edwards, closely aligned politically with trial lawyer groups. And given that changing the rules and timing of lawsuit filings and procedures involves some adjustments by courts and judges, the latter personages were also listened to in the State Capitol.
The result: compromise, but we think a compromise that is in the best interests of Louisiana’s drivers, both of regular vehicles but also trucks and commercial transport.
Backers said House Bill 57 will shrink the number of personal-injury court cases and reduce Louisiana’s perennially high car insurance rates. But this second version of the measure — the first was flawed, technically, and Edwards properly vetoed it — doesn’t go as far as many in the business community wanted.
Still, it’s a bill that the governor can sign and one that we believe will be helpful. Insurance Commissioner Jim Donelon can rattle off examples of companies that have seen high rates of lawsuits in Louisiana compared to their lines of business in other states. For those seriously injured in car accidents, access to the courts is not shut off by HB57.
As Stephen Waguespack of the Louisiana Association of Business and Industry argued, the compromise “will help begin the process of rebuilding Louisiana’s insurance markets.”
That statement underlines one issue that people ought to keep in mind. Insurance is a business, and competitive markets will generate lower prices for consumers, although perhaps not in the first year of operation of the new law. Time is required for this bill to work.
During the next couple of years, the governor is going to be around, too, to use his veto pen if business interests push too hard for further legislation, before HB57 has proved out.
Litigation costs, while important, are only one factor in sky-high insurance rates. Reckless driving and poor roads also produce accidents, raising rates.
Louisiana is going to have to tackle other problems, including investments in road repairs, to have the fullest relief from insurance costs on our highways.