SPRINGFIELD -- State Rep. David Leitch believes the coverage requirements for Illinois’ mandatory auto insurance are too low and should be raised after more than two decades without change. 


SPRINGFIELD -- State Rep. David Leitch believes the coverage requirements for Illinois’ mandatory auto insurance are too low and should be raised after more than two decades without change.

The Illinois insurance industry disagreed and said higher minimums would lead to more uninsured motorists.

The insurance industry prevailed Tuesday.

The House Insurance Committee shot down Leitch’s House Bill 231, which would have significantly increased the amount of liability coverage Illinois motorists are required to carry. Motorists now are required to have at least $20,000 worth of insurance to cover the death or injury of one person, $40,000 to cover death or injury to more than one person, and $15,000 to cover property damage. Leitch’s bill would have changed those requirements to $100,000, $300,000 and $100,000, respectively.

“I was impressed by the power of the insurance lobby,” the Peoria Republican said after Tuesday’s hearing.

Leitch said the bill was prompted by a constituent whose friend was critically injured in a head-on collision that killed another person in the car. The driver at fault had only minimal insurance coverage, which didn’t cover the medical bills.

“Not even close,” Leitch said. “It’s just simply not responsible this family would have to be treated this way.”

State Farm, Liberty Mutual, the Illinois Insurance Association, the American Insurance Association and the Property Casualty Insurers’ Association all registered as opponents of HB231.

“I think if you would increase (to Leitch’s limits), I would probably guarantee you the number of uninsured drivers in Illinois would probably skyrocket,” said the IIA’s Kevin Martin. “It would be unfortunate for those involved in accidents currently with uninsured drivers to even have more exposure to being involved with accidents down the road with people who are uninsured.”

Martin said the reason is that insurance premiums would go up, and more drivers would simply drop their coverage.

“I think you would be guaranteed the increase in premiums would be substantial,” Martin said.

However, he was unable to provide the committee with any examples of cost increases, saying a number of factors determine an individual’s auto insurance rates.

“The number of uninsured motorists would skyrocket,” said Mark Mifflin of the Property Casualty Insurers’ Association. “In these dire times, when a lot of people are in dire financial circumstances, we believe that increasing the limits this amount would mean a lot more people couldn’t afford that.”

Secretary of State Jesse White’s office, which didn’t take a position on the bill, estimates about 4.5 percent of Illinois motorists do not have auto insurance, even though they face fines and license suspensions if they are caught. Illinois has had mandatory insurance since 1990. The coverage requirements haven’t changed since the law was enacted.

“We all know that the cost of health care has gone up,” said Rep. Robyn Gabel, D-Evanston, who supported the bill.

Mifflin said he believes the current requirements are enough to cover the vast majority of accidents, although he was unable to provide documentation to the committee.

“The policy of having some insurance for almost everybody is better, we believe, than having greater insurance for lesser people,” Mifflin said.

Leitch said he was willing to negotiate a smaller increase in coverage requirements if that would have made the bill more palatable. Both Martin and Mifflin said it would not, because higher limits would still result in more uninsured drivers.

The committee vote was 6-12. Both Republicans and Democrats opposed it.

Mifflin and Martin promised to provide additional information about possible rate increases and whether current requirements cover most accidents. Leitch said that information will determine what he does next.

“I want to see what those numbers say,” Leitch said. “I think this is a lot bigger issue than some have suggested today in committee,”

 

Doug Finke can be reached at (217) 788-1527.