Wisconsin Upgrades Car Insurance Policies – Insurance Companies Taken by Surprise


Drastic changes in laws governing auto insurance in the state of Wisconsin is happening to fast; too fast that even major insurance industry players are struggling to cope up with the sudden changes. New car insurance requirements took effect last November 1, and the other changes are set to become a law next year.

Wisconsin Upgrades Car Insurance Policies - Insurance Companies Taken by SurpriseChanges in Wisconsin State law mandates all motorists to have car insurance and calls for providers to increase liability minimum requirements. Changes in minimums have been effective at the beginning of 2009. On the other hand, liability insurance has become mandatory starting June 1. Starting January 1st, liability insurance minimums have been increased from $25,000 to $50,000 per person and from $50,000 to $100,000 per accident. For property damage coverage, minimum requirement has been upgraded from $10,000 to $15,000. Insurance experts say that mandating all drivers to purchase car insurance can do a lot of good to everyone, but the changes regarding under insured and uninsured motorists that took effect beginning November 1, did not allow companies to have ample time to prepare for system and process adjustments. The minimum for underinsured driver coverage have been increased from $25,000 to $100,000 per person and from $50,000 to $300,000 per accident. According to insurance experts, the total minimum hikes if computed would amount to $100,000 per person to $300,000 per accident occurrence.

According to a major insurance provider in Hudson, Wisconsin, their company is having a hard time adjusting to the fast changes; and even though it has been weeks since the new changes took effect, they are still on their toes keeping up with the transition process. A Hudson insurance company even speculates that amendments were probably passed through the budget process in the legislature and not through normal legislation process, which is why they all happened too fast.

Insurance insiders in Wisconsin claim that the State is included in the list of US states that do not require auto insurance. Experts believe this is the reason why the change caused extreme reactions not only from providers, but from consumers and car owners as well. From being allowed to have zero car insurance, motorists are now mandated to purchase policies; and existing policy holders need to upgrade their papers to keep up with new state law requirements.

Insurance companies are expecting to get complaints from their customers regarding the changes. Any increase in minimums equals an increase in premium rates for the motorist. When asked about what she will say upon receiving a customer complaint, one insurance company representative said, “Do not blame us; blame the lawmakers for the coverage.”