Wisconsin drivers begin to pay more for auto insurance as law makes some premiums higher
Wisconsinites are used to facing winter driving obstacles every year. But this season, motorists could face something scarier than black ice and blizzards — higher car insurance premiums.
The increases, which some people already are seeing, are the result of new insurance laws passed in June as part of the state budget. One of those laws requires that any auto insurance policy issued or renewed on or after Nov. 1 have uninsured motorist coverage equaling $100,000 per person and $300,000 per accident. Uninsured motorist insurance pays the medical bills of a driver or passenger injured in an accident caused by an uninsured driver. The insurance always was required, but before Nov. 1, the limits were $25,000 per person and $50,000 per accident.
The law also requires drivers to carry insurance for underinsured motorists of up to $100,000 per person and $300,000 per accident. Underinsured motorist coverage helps to pay medical bills of people injured in an accident caused by a driver without sufficient insurance. Insurance companies had offered the coverage for several years, but it was never a requirement.
Steve Kropidlowski, an agent with State Farm in Stevens Point, said the increases are some of the biggest he’s seen in his 25 years selling insurance. Over the last few weeks, he has fielded dozens of questions from policyholders upset or confused about premium increases caused by the new coverage limits.
He expects to get more calls next year when new limits for liability insurance, which pays for property damage when the policyholder is at fault, go into effect. Currently, Wisconsin drivers must have a policy that provides $25,000 for the injury or death of one person, $50,000 for the injury or death of two or more people, and $10,000 for property damage.
On Jan. 1, drivers will be required to have liability coverage of $50,000, $100,000 and $25,000.
“Everybody notices. Everybody is more cost conscious,” he said. “A lot of people think it’s the insurance companies raising the limits.”
While drivers might find the new requirements frustrating, Allstate Insurance Principal Eric Nier, who has offices in Stevens Point and Wisconsin Rapids, said the premium increases should be nominal for most customers, between $10 and $30 for a six-month policy, depending on what coverage they had before. He added that Allstate plans to send out letters to policyholders notifying them of the change. Under state law, insurance companies need only notify customers of rate increases of 25 percent or more.
No matter how minimal increases to premiums might be, there are a lot of people who would like to see the coverage increases reversed, especially Sen. Mike Ellis, R-Neenah. He has introduced a measure that would repeal all the new requirements, except the one that mandates all motorists have insurance by June 1. His biggest problem with the requirements is that they were approved as part of the state budget, which kept legislators from considering the proposals on their own merit.
“There should have been a series of public hearings, but they buried this in a 1,500-page budget bill,” Ellis said.
Tags: driving obstacles, higher car insurance premiums, liability coverage