Repeal of Pro-Consumer Insurance Law Leaves
Insurance Agents at Risk of Liability
The Legislature’s vote to repeal legislation passed just two years ago not only allows insurance companies to reduce or avoid paying insurance coverage Wisconsin citizens thought they had purchased, it leaves insurance agents at risk of liability.
Wisconsin Association for Justice President Mike End said, “The passage of AB 4 will hurt Wisconsin citizens. This removal of the protections placed into law two years ago will result in consumers having less insurance protection than they will pay for. This will leave many people inadequately compensated for their injuries and will result in unpaid bills from an automobile collision."
The new law will once again allow insurance companies to define underinsured motorist coverage in a way that may prevent the coverage from applying and allowing the insurers to again reduce such coverage by the amount of liability insurance carried by the negligent driver. The new law will also restrict a person to receiving uninsured motorist coverage and underinsured motorist coverage to just one vehicle, no matter how many vehicles the person has purchased such insurance for.
End said, “These restrictions of coverage may make the difference between an injured person paying their bills or having to file for bankruptcy. Removing these basic consumer rights may have devastating consequences for Wisconsin citizens injured by negligent drivers. The legislators who voted for this bill sold out their constituents.”
Ed Vopal, President-Elect of WAJ says, “As a result of these changes, Wisconsin automobile insurance consumers will have to be more diligent both in securing coverage from their insurance agents and understanding it.”
How can consumers protect themselves from these anti-consumer provisions?
Vopal says, “Wisconsin insurance consumers can protect themselves and their family by meeting with their insurance agent and requesting the specific coverage they need, getting an agreement for that needed coverage, and affirming the special nature of their relationship with the agent. When consumers do this, the insurance agents have a duty to fulfill the insureds’ requests and secure the coverage. If the agents do not secure the requested and agreed-upon coverage, they may be liable to a person who does not receive the coverage he or she requested.”
Here is a list of things insurance consumers can do that will help protect them.
- When you get a renewal notice, contact your insurance agent and review in person all changes in circumstances before each policy renewal.
- Make specific requests for coverage to the agent. Tell the agent your specific needs for insurance coverage; i.e., how much coverage you want to purchase for liability, UM/UIM, medical payments coverage, etc. For now, tell your agent that you want the exact same coverage that you presently have, without any changes to it. You do not want any reducing clauses or anti-stacking provisions.
- At or immediately after the meeting, get the agent’s agreement to insure you and your family at the levels selected. This confirmation is best done in writing.
- If your agent or company tells you they can’t provide the same level of coverage, then ask for endorsements that will reinstate the UM and UIM coverages and benefits you presently have. Again, document this in writing.
- If your agent or company tells you they are not willing to give you these endorsements or charge a substantially higher premium for the exact same coverage you have now, then look for another company who will.
Vopal concluded, “If insurance consumers follow the above suggestions, they are more likely to create the “special relationship” with an insurance agent that can make the agent liable if the agent does not provide the specific insurance coverage requested.”
The Wisconsin Association for Justice stands with consumers to promote a fair and effective justice system for every citizen, not just the privileged and wealthy.