Auto insurance becomes mandatory

• Meme Fehr

Meme Fehr

Talk about it

State law that requires all motorists in Wisconsin have insurance and hikes liability minimums is causing some headaches in the industry.

For one thing, the laws came through the budget process in the legislature and not the normal path of legislation, said Meme Fehr, of Sandeen Insurance in Hudson. Because of that unusual path to law, some of the new requirements were put in place Nov. 1 and others will become law next year.

“Wisconsin was one of three or four states that didn’t require vehicle insurance,” Fehr said last week during a discussion of the new mandates in her downtown Hudson office.

On Jan. 1, liability insurance minimums rise from $25,000 to $50,000 per person; $50,000 to $100,000 per occurrence and $10,000 to $15,000 for property damage. Liability insurance becomes mandatory next June 1.

Requiring all drivers to have insurance is not a bad thing or a big deal, she said. But the increase in uninsured and under insured motorists that went into effect Nov. 1 didn’t give insurance agencies much time to work out the kinks in the process.

Underinsured driver coverage minimums have been boosted from $25,000 per person to $100,000 and from $50,000 per occurrence to $300,000; the bottom line for uninsured motorist coverage as been hiked from $100,000 per person to $300,000.

In addition, policies issued or renewed after Nov. 1 are required to contain provision for medical payment coverage of $10,000 per person.

The rise in minimums translates into a hike in premiums for the car owner. “Don’t blame the insurance agency for the rise in costs, blame the legislator for the mandatory coverage,” Fehr said.

However, Tom Nelson (D-Kaukauna), Assembly Majority Leader, told his constituents last month that, “any premium increases are due to the business decision of insurance providers, rather than action taken by the Legislature,” according to an Associated Press story last month.

Auto owners should check with their insurance agency to determine what their coverage is and what change may be required Fehr said.

For more information, contact www.sandeen.com or the Wisconsin Office of the Commissioner of Insurance at www.oci.wi.gov on the Web.

Tags: auto insurance, state law, news, wisconsin