A recently-enforced law in Wisconsin made insurance coverage mandatory to all motorists. Also, insurance companies are now required to hike liability minimums of policyholders.
Meme Fehr of Sandeen Insurance in Hudson explained that the recently passed laws were made during the budgetary hearings in the legislature, and did not go through the traditional path of legislation. Some of the provisions of the new legislation were put into effect on November 1, while the rest will not be implemented until next year.
Previously, Wisconsin was one of the four remaining states in the US where motorists were not required to have auto insurance coverage.
Liability insurance minimums in Wisconsin have recently been hiked in accordance to the new law, with majority of the rates increasing by twice their original amount. For example liability insurance minimums per person went up from $25,000 to $50,000; per occurrence rose 100% from $50,000 to $100,000, and property damage increased by almost 70%, from $10,000 to $15,000. Liability insurance will become mandatory in Wisconsin come June 1 of next year.
The auto insurance industry welcomed the recent development and was expecting higher revenues with new clients coming in. However, some insurance companies are struggling to keep up with some of the new requirements, especially the provisions covering uninsured and underinsured motorists. These firms complain that they were not given ample time to adjust to the modifications, some of which took effect on November 1, 2009.
For example, the coverage minimum for underinsured drivers went up from $25,000 per person to $100,000, per occurrence moved up from $50,000 to $300,000. On the other hand, the bottom line for uninsured motorist coverage increased by 300% from $100,000 to $300,000. Insurance companies are also required to include a medical payment of $10,000 per individual for insurance policies that were approved or renewed after November 1, 2009.
With the recent hikes in insurance minimums as provided by the new law, insurers are left with no choice but to pass off resulting additional expenses to consumers. Insurance companies blame legislators for the recent surge in insurance fees and charges.
Lawmakers on the other hand countered by saying that insurance premium increases are purely business decisions and are largely independent of legislative action/s. They felt that it was unfair on the part of insurance companies to accuse legislators of influencing prices, when in reality they could very well afford to sell insurance policies at competitive prices and still remain profitable.
Wisconsin policyholders are advised to keep themselves updated of the recent developments in auto insurance coverage laws by coordinating with Wisconsin auto insurance companies.
