BATON ROUGE–With the special session nearing an end, the Senate passed a possible compromise bill Monday aimed at lowering auto insurance rates and winning support from Gov. John Bel Edwards, who vetoed a major Republican-backed tort reform plan.
The bill, by Rep. Richard Nelson, R-Mandeville, passed 35-3, with seven Democrats voting in support. The House passed Nelson’s bill 82-9 last week, with 21 Democrats voting for it.
It is one of several bills and resolutions that GOP lawmakers have passed that could serve as substitutes for the one that Edwards vetoed, but it is not clear if the business groups that originally pushed for the changes would agree to the compromises in Nelson’s bill.
The vetoed bill was proposed by Sen. Kirk Talbot, R-River Ridge. It would have limited damages awarded to plaintiffs in personal injury cases in an attempt to lower auto insurance premiums.
Louisiana has the second highest car insurance rates in the country, after Michigan.
Republicans have not been able to muster the votes to override Edwards’ veto, and have focused on passing replacement bills while negotiating with Democrats, who want guarantees that rates would go down and that accident victims would not be unfairly treated.
House Speaker Clay Schexnayder, R-Gonzales, also has written a bill that could provide an alternative approach. Rep. Alan Seabaugh, R-Shreveport, and Sen. Robert Mills, R-Minden, have filed three identical resolutions that follow Talbot’s methods to lower insurance rates and could be implemented without Edwards’ consent.
The session must adjourn by 6 p.m. Tuesday.
Like Talbot’s bill, Nelson’s would extend the time that parties have to file suits in hopes of encouraging parties to settle out of court. It would also limit the amount of recoverable medical expenses and insurance premium payments, and it would lower the monetary amount an injury has to be worth to be decided by a jury rather than a judge.
But unlike Talbot’s bill, it would reduce the default number of jurors to six from 12 to try to lessen the burden on courts and jurors. Judges expressed concerns that Talbot’s bill would overwhelm
courts with jury trials and that rural areas could have trouble finding enough jurors for personal injury cases.
In another compromise, Nelson’s bill includes a mandatory rate reduction and a sunset provision that would repeal the law if rates did not decrease by at least 15% in three years.
Democrats opposed Talbot’s bill because it did not mandate rate reductions, and Republicans refused to include language that would repeal the legislation if the changes did not result in lower premiums.
Unlike any other so-called tort reform bill this session, Nelson’s included comparative fault language that would prevent injured plaintiffs from recovering damages if their percentage of fault is greater than the combined percentage of fault of all other persons found to have contributed to the injury, death, or loss.
Twenty-three states have comparative fault, Nelson said, and the 14 states with the lowest car insurance rates have the same provision included in his bill.
Nelson’s bill would prohibit insurance companies from setting rates based on a driver’s gender if they are over the age of 25.
Democrats sponsored bills that would have tried to lower insurance rates by prohibiting insurance companies from determining rates based on age, gender, marital status and credit score, but faced opposition from Republicans. Edwards has said he supports this measure and that he believes “discriminatory practices” need to end in order to lower rates.
Sen. Jay Luneau, D-Alexandria, authored several bills that would have prohibited these “discriminatory practices,” but his bills were killed in committee. Despite Nelson’s compromise, Luneau was one of the three votes in opposition of Nelson’s bill.
“This bill puts something bad for everybody, and it makes for a bad bill all around,” he said of the compromise.
Other Democrats spoke in support of the bill, saying the debate over insurance rates has lasted for too long with no real action.
“I’m a trial lawyer, but at the end of the day I want to end this debate about what we need to do to lower insurance rates,” said Sen. Cleo Fields, D-Baton Rouge.
Sen. Karen Peterson, D-New Orleans, agreed and said, “Let’s pass this bill, the governor signs it, and for the next four months let’s talk about something that’s actually going to move the needle.”
The bill now moves back to the House.