Provides for the removal of an offset or credit against uninsured motorist coverage when the carrier is insolvent. (8/1/17)
If enacted, SB 184 would remove the existing offset or credit against uninsured motorist coverage in cases where the insurer is insolvent. This would allow claimants to receive full compensation under their uninsured motorist policies without having to account for credits from other available coverages. The legislation is expected to enhance protection for insured individuals facing losses due to their primary insurer's inability to pay, particularly in the event of insurer insolvency.
Senate Bill 184 aims to amend provisions related to the Louisiana Insurance Guaranty Association, specifically addressing the obligations of insured individuals when their insurer becomes insolvent. The bill mandates that individuals with claims must first exhaust all coverage available from other insurance policies, excluding their own uninsured or underinsured motorist policies. This change intends to clarify the process for recovering claims when an insurer cannot fulfill its obligations due to insolvency.
The general sentiment surrounding SB 184 appears to be supportive, particularly among those advocating for stronger protections for consumers in the insurance market. The bill was passed unanimously in a Senate vote, suggesting strong bipartisan agreement on the need to improve the handling of claims related to insurer insolvency. Stakeholders view the bill as a necessary adjustment to ensure that consumers can fully rely on their uninsured motorist protections without being penalized by their insurer’s failure.
While the bill has garnered support, the discussion around its implications highlighted concerns regarding the potential for increased claims processing and the financial health of the Louisiana Insurance Guaranty Association. Some critics raised questions about the sustainability of the guaranty association's funding as a result of extending full coverage without offsets. Thus, although the bill is seen positively, there remain unresolved discussions about its long-term effects on the insurance ecosystem in Louisiana.