Colorado Auto Bill Defeated in House

A bill that would have created special insurance coverage for low-income Colorado drivers was defeated on the House floor. H.B. 1089 would have established a reduced-limits auto policy for low-income consumers, similar to a bill that was recently passed in California.

Although the bill did not include a mandatory offer, insurers were concerned that it would be amended to make it a mandatory offer, according to Michael Harrold, Northwest regional manager for the National Association of Independent Insurers. NAII opposed the measure.

“The Colorado House made a wise decision when it voted down this bill,” Harrold said. A low-cost auto bill is especially unnecessary in Colorado, where state law already exists to offer reduced coverage to low-income drivers, he said.

The current law allows insurance companies to equitably price the low-income policies, while H.B. 1089 would have required insurers to give preferred rates to all low-income drivers. “Mandatory systems are both actuarially unsound and unfair because they create a system where good drivers subsidize bad ones.”