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Auto Insurance Reform Bills 

  A bill to change auto insurance arbitration laws has cleared a House committee, but another bill to sever the ties between individual credit scores and auto insurance rates was killed in the same committee — despite support from the New Orleans delegation.

  The House Insurance Committee approved House Bill 698 by Rep. Joe Harrison, R-Napoleonville, citing the need for consumer protection. That bill would prohibit automobile insurance companies from using arbitration or mediation to determine fault after an accident unless they first notify their insureds. Harrison said he had personally been involved in an accident that resulted in a higher premium because his insurance company met privately with another company to discuss the accident and assign fault. "I didn't even know they were meeting," he told the committee. "They're talking about raising my premiums and I'm not even there."

  In other action, the committee rejected Harrison's House Bill 512, which would have limited how insurance companies can use credit scores to set premiums. The bill would have limited insurers to using credit information that relates to the payment of insurance premiums — not general credit scores, as is presently done.

  Rep. Juan LaFonta, D-New Orleans, a member of the committee, said sometimes people run into a patch of bad luck or have a family emergency, which can adversely affect their insurance rates. "I think this bill is a step in the right direction for people who had trouble after Hurricanes Katrina and Rita," LaFonta said. Insurance lobbyists argued that they have no other way to determine risk. That was enough for the committee to shoot down the proposal. — Jeremy Alford


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