Letter: Lawmakers Should Reject Proposal to Raise Auto Insurance Costs | Letters

Thanks to legislation passed last year, 15% of Virginians will see their car insurance costs increase.

The new law, which came into effect on January 1, will require many drivers to purchase additional coverage to meet the new minimum liability limits required.

Now lawmakers are once again considering a bill (Senate Bill 754) that could further increase costs.

It’s time for Virginia lawmakers to put consumers first and rein in proposals that could raise auto insurance costs.

SB 754 would automatically convert current auto policies to underinsured motorist (UIM) excess coverage without the policyholder’s consent. If a policyholder doesn’t want the change, they’ll have to file a written opt-out request and most consumers won’t know.

It’s a very complex issue, and it’s likely to hit Virginians’ wallets hard. According to estimates by the American Property Casualty Insurance Association, SB 754 could increase the cost of UIM coverage by two-thirds per vehicle.

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SB 754 could also significantly increase the number of claims eligible for UIM coverage and increase costs associated with claims, leading to a further increase in auto insurance for Virginia consumers and businesses.

The law SB 754 attempts to change has been in effect for more than 50 years and during that time it has reduced costs.

In fact, states with definitions of underinsured and uninsured motorist similar to what SB 754 proposes have claim costs that are 68% higher than states that define underinsured motorist as does currently Virginia. Current Virginia law is working and saving consumers money.

If SB 754 passes and auto insurance costs rise, coverage could become unaffordable for some, which could lead to more uninsured drivers, making Virginia’s roads less safe. Virginia is blessed with the 17th lowest uninsured driver rate in the nation and we don’t want to see that trend go in the wrong direction.

Virginia families and businesses are already facing cost increases for many goods and services as inflation continues to impact our nation’s economy. Now is not the time for lawmakers to implement major policy changes that could further increase costs for hard-working Virginians. We urge Virginia lawmakers to protect consumers from higher auto insurance costs by voting no on SB 754.

Nancy Egan, Vice President and State Government Relations Advisor for the American Property Casualty Insurance Association.

Egan is Vice President and State Government Relations Advisor for the American Property Casualty Insurance Association.