Auto Insurance

2006 Interim Legislative Committee Evaluates Tort System

In July 2005, a legislative committee on auto insurance was formed to address many concerns that have arisen since the change from the No-Fault Auto Insurance System to the current Tort System. The charge of the committee was to identify problems and to present possible solutions by way of legislative bills that would be considered during the regular session.

The committee conducted a thorough investigation of all the complicated issues related to auto insurance. They received expert testimony in virtually every area. CUA conducted a survey of our members and testified before this committee at that time.

After careful consideration of testimony, the committee produced several pieces of legislation that were considered during this legislative session. Some have passed and some have not:

Passed:

HB06-1030 Auto Insurance Disclosure Requirements
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Requires auto insurance companies to disclose and explain all options available to the consumer and the ramifications of turning down portions of the policy the consumer opts out of. This bill was necessary because many consumers who need MedPay are opting out of it, putting themselves at significant risk. The bill also made MedPay the primary payee over personal health insurance coverage.

SB06-041 Prompt Pay Auto Accident Claims
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Requires auto insurance companies to pay accident claims promptly regardless of whether fault in the accident has been determined. Prior to this bill, this was not a requirement as it was under no-fault.

Did Not Pass:

SB06-019 Mandatory medical coverage
This bill concerned a requirement that emergency medical care coverage (MedPay) be included in auto insurance policies. Currently, Medpay is not a requirement.

HB06-1036 Mandatory offer of Medical Payment Coverage
This bill addressed the need for all auto insurance companies to offer medical payment coverage. This is not currently a requirement.

HB06-1043 Consumer Insurance Board
Would have created a board of consumers to oversee consumer insurance issues.

HB06-1044 Third-party claims
Concerned claims practices for bodily injury to a third-party claimant arising out of the use of an automobile. The bill would have provided for prompt payment for bodily injury arising from accidents to any injured person.