By Greg Bump
If state insurance industry officials are right, Gov. Jim Doyle’s budget bill could lead to a jump in insurance rates for individuals and businesses in Wisconsin.
One item Doyle is proposing would raise the minimum coverage requirement on auto insurance.
The president of the Wisconsin Insurance Alliance, Andy Franken, says raising caps would mean Wisconsin car insurance customers would see their rates jump by between 33 percent and 43 percent. Franken says the hardest hit ratepayers would be low- and middle-income families and individuals because they often purchase the minimum level of insurance. But he adds the change would impact all ratepayers.
In a separate proposal, Doyle proposes to alter what’s called the joint and several liability language in a way Franken says would impact small and large businesses across the state. The Wisconsin Civil Justice Council, which represents Wisconsin employers in civil litigation issues facing Wisconsin, dubbed the joint and several liability provision “budget stimulus for trial lawyers.”
But Madison attorney Keith Clifford downplayed both potential changes. He says the old minimums for auto insurance have been in place for nearly 30 years.
“The burden of costs of these cases has been shifted from liability to health insurance and BadgerCare and Medicaid,” Clifford said. The policy change “shifts the burden off health insurers and back onto liability insurance where it belongs.”
Clifford said insurance customers shouldn’t see a dramatic jump in costs due to the change. He said Wisconsin is one of two states that doesn’t require drivers to carry auto insurance, yet Wisconsin is among the lowest in the nation for rates.
“The mandate on insurance has nothing to do with the cost of insurance, and coverage increases aren’t going to have anything to do with it either,” he said. “The fact is the minimums barely have anything to do with the rates.”