Car insurance bills to rise for Louisiana drivers ?

Auto insurance rates will rise Friday for more than 1 million Louisiana motorists as a law increasing the required minimum liability coverage goes into effect. Though the change was approved by the Legislature in 2008, many drivers are expected to be caught off-guard because insurance companies weren’t required to notify policyholders. Insurance Commissioner Jim Donelon says the boost in car insurance bills may come at a tough time for some because of the economic slump. But he says it’s needed to bring the nearly 30-year-old minimum liability requirement in line with rising costs associated with accidents, including higher costs for medical care, repairs and replacement vehicles. “Certainly there are thousands of drivers out there who can ill-afford this additional cost. That’s always the case. I think that’s outweighed by the tens of thousands who are left uncompensated by the damage that minimally insured drivers do,” Donelon says. About 2.5 million vehicles are insured in Louisiana, and Donelon says 40% carry only the minimum liability coverage required. Louisiana law currently requires car and truck owners to have at least “10-20-10” liability coverage. That’s $10,000 coverage for injury or death to one person in an accident, $20,000 for injury or death to more than one person and $10,000 for damage of other people’s property. The new law changes the levels to “15-30-25.” The average minimally insured policyholder will pay about $71 more a year for car insurance, says Richard Piazza, chief actuary for the Louisiana Department of Insurance.