Auto Insurance Changes Targeted for Repeal in Wisconsin

Republicans in the Wisconsin Legislature are aiming to repeal most of the auto insurance coverage increases mandated by Democrats, which industry and state regulators blame for higher premiums.

Drivers would still be required to carry car insurance, a change that took effect last year. However, a bill by Rep. John Nygren, R-Marinette, and Sen. Frank Lasee, R-De Pere, would repeal almost everything else Democrats passed in 2009.

The Wisconsin Insurance Alliance, which represents insurance companies, lobbied heavily against the law changes passed by Democrats. The alliance’s president Andy Franken said each policyholder would be affected differently by the changes, but anyone who purchased higher levels of coverage but could not lower them should see a price cut.

The Wisconsin Association for Justice, which represents trial attorneys, backed the previous law changes arguing that raising minimum coverage levels was justified because they hadn’t been increased in nearly three decades and they didn’t reflect current costs.

Christine Bremer Muggli, an attorney who pushed for the law change when she was president of the association, said repealing the law now would be a windfall for insurance companies who would provide less coverage but not lower rates. “It will not happen. The rates will stay the same,” she said. “Everything will be exactly the same and coverage will be diminished.”

Under the Republican bill, minimum required levels of insurance coverage would decrease to what they were prior to the 2009 changes. Currently, the minimum level of liability insurance required is $50,000 for causing injury or death of one person, $100,000 for injury or death of two people and $15,000 for property damage.

The proposal would drop the levels to $25,000, $50,000 and $10,000.

Under current law, all auto insurance policies must have underinsured coverage. That coverage, which had been voluntary, is for when another motorist causes an accident and has lower liability limits than the amount of damages in the accident.

The Republican proposal would continue to make that coverage mandatory, but the level required would drop from $100,000 per person and $300,000 per accident to $50,000 per person and $100,000 per accident.

Minimum levels for uninsured motorist coverage, which increased in 2009, would go down as well. Coverage for medical payments would remain voluntary but would also decrease.

Also, policyholders would no longer be able to “stack” coverage, which was legalized in 2009. Stacking refers to insured motorists involved in an accident with a covered vehicle applying uninsured and underinsured coverage from up to three other vehicles to help pay for damages.