No Need to Raise Kansas Auto Insurance Limits

When legislation that would force consumers to buy more of a thing is opposed even by the companies who sell that thing, that’s a pretty good sign it’s a pretty bad idea. H.B. 2104, under consideration by the Kansas House Insurance Committee, would double the minimum liability limits for auto insurance sold in the state from $25,000 per-person and $50,000 per-accident to $50,000 and $100,000 respectively.

Kansas’ required current minimum coverages are typical of those found in other states nationwide and are identical to the minimums in neighboring Nebraska, Missouri, Oklahoma and Colorado. The overwhelming majority of accident claims are covered by those limits and more than three-quarters of Kansas consumers voluntarily buy more coverage. Raising the minimums would premium rates to rise, which in turn likely would lead more of the poorest citizens to become uninsured drivers. That’s one reason insurance companies, who otherwise would benefit from selling more coverage, have opposed the legislation.

There is no crisis of large claims that would justify such a large increase in the mandatory coverage. The House of Delegates should reject this proposal.