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Coding: Words which are struck through are deletions from existing law;
words in boldface type and underscored are additions.
Regular Session, 2010
SENATE BILL NO. 150
BY SENATOR DUPLESSIS
INSURANCE RATES. Provides relative to automobile insurance rates after a voluntary
lapse in coverage occurs. (8/15/10)
AN ACT1
To enact R.S. 22:1284.1, relative to motor vehicle insurance; to prohibit an increase in the2
premium rate when there is a lapse in coverage under certain circumstances; and to3
provide for related matters.4
Be it enacted by the Legislature of Louisiana:5
Section 1. R.S. 22:1284.1 is hereby enacted to read as follows: 6
ยง1284.1. Motor vehicle insurance; consideration of lapse in coverage7
prohibited8
A. No insurer shall increase the premium rate or increase or add a9
surcharge on any policy of motor vehicle insurance when such action is based10
solely on consideration of a lapse in coverage, as defined in this Section,11
regarding the insured as provided in this Section.12
B. As used in this Section, a"lapse in coverage" is that period of time13
during which the owner of a motor vehicle who formerly maintained liability14
coverage on a vehicle, as required under the Motor Vehicle Safety15
Responsibility Law, first voluntarily surrenders the vehicle's license plate to the16
office of motor vehicles and then ceases to maintain a policy of insurance or17 SB NO. 150
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Coding: Words which are struck through are deletions from existing law;
words in boldface type and underscored are additions.
other security as required by the Motor Vehicle Safety Responsibility Law.1
C. Any insurer who violates the provisions of this Section shall refund2
to the insured person the amount of premium which was paid that exceeded the3
amount of premium which would have been charged if the insurer had complied4
with this Section. The commissioner of insurance shall promulgate rules and5
regulations to enforce the provisions of this Section.6
D. Notwithstanding any other provisions of law to the contrary, one or7
more lapses in coverage, as defined in this Section, shall not be the sole basis for8
an insurer's denial of an application for a policy of motor vehicle insurance nor9
shall such lapse in coverage be considered by an insurer in determining the10
rates for such a policy. In addition, no insurer shall require that such coverage11
be provided by another insurer based solely upon such a lapse in coverage.12
The original instrument and the following digest, which constitutes no part
of the legislative instrument, were prepared by Cheryl Horne.
DIGEST
Duplessis (SB 150)
Proposed law prohibits an insurer from increasing the rate or increasing or adding a
surcharge when such action is based solely on consideration of a lapse in coverage.
Proposed law defines "lapse in coverage" as period of time during which the owner of a
motor vehicle who formerly maintained liability coverage on a vehicle, as required under
the Motor Vehicle Safety Responsibility Law, first voluntarily surrenders the vehicle's
license plate to the office of motor vehicles and then ceases to maintain a policy of insurance
or other security as required by the Motor Vehicle Safety Responsibility Law.
Proposed law requires any insurer who violates proposed law to refund to the insured person
the amount of premium which was paid that exceeded the amount of premium which would
have been charged if the insurer had complied with proposed law.
Proposed law requires that one or more lapses in coverage shall not be the sole basis for an
insurer's denial of an application for a policy of motor vehicle insurance nor shall such lapse
in coverage be considered by an insurer in determining the rates for such a policy. No
insurer shall require that such coverage be provided by another insurer based solely upon
such a lapse in coverage.
Proposed law requires the commissioner of insurance to promulgate rules and regulations
to enforce the provisions of proposed law.
Effective August 15, 2010.
(Adds R.S. 22:1284.1) SB NO. 150
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Coding: Words which are struck through are deletions from existing law;
words in boldface type and underscored are additions.
Summary of Amendments Adopted by Senate
Committee Amendments Proposed by Senate Committee on Insurance to the original
bill.
1. Removes the requirement that the lapse in coverage cannot exceed 24
months.
2. Requires any insurer who violates the provisions in proposed law to refund
to the insured person the amount of premium which was paid that exceeded
the amount of premium which would have been charged if the insurer had
complied with proposed law.
3. Removes the provision that the insured be entitled to attorney fees.
4. Requires the commissioner of insurance to promulgate rules and regulations
to enforce the provisions of proposed law.