If Republicans in the Wisconsin Legislature have their way, big changes are on the way when it comes to auto insurance. The state Senate has already passed a measure that rolls back reforms enacted in 2009, and the Assembly could take up the matter as early as this week.
Those opposed to the rollback say one provision that hurts consumers is the so-called "reducing clause." They say it would allow insurers to insert fine print into complex auto insurance policies to limit total coverage when two or more policies are involved.
Daniel Plumb testified at a hearing on the matter. He says the elimination of the reducing clause saved his father from bankruptcy after he was hit in Sheboygan County while riding his motorcycle. Had the rollback been in place, Plumb says his father would have only collected a fraction of his medical expenses.
"He has over $1 million in medical bills. He would have only been able to collect $250,000 from the gentleman who ran into him with his truck."
The Property Casualty Insurers Association of America says the rollback will lead to lower costs for consumers. However, Plumb says policies with the reducing clause leave people with a false sense of security, when they think they have more coverage than they really do.
"What the reducing clause does, is it sets an upper limit. If your number was $300,000 for bodily injury and the guy that hit you was at $250,000, that means your insurance only gives you $50,000 more."
The Wisconsin Association for Justice, which opposes the rollback, says consumers should be able to collect the full value of all policies when they are injured.
No comments:
Post a Comment