Insurance commissioner discusses Louisiana's car insurance costs - FOX 8 WVUE New Orleans News, Weather, Sports

Insurance commissioner discusses Louisiana's highest-in-nation car insurance

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New Orleans, La. -

The state insurance commissioner is weighing in on the reasons why Louisiana has the highest auto insurance rates in the country.

Jim Donelon says those rates are driven up by laws which factor in large legal settlements, and he says judges in the New Orleans area are the biggest culprits.

Cars slam into each other on Girod Street Thursday due to a power outage, adding to a state car crash rate that consistently leads the nation.

Louisiana's high crash rate feeds the highest insurance rates in the country, and those rates are driven up by insurance settlements in the New Orleans metro area.

"In Louisiana's 64 parishes, four of them are the problem." said Donelon, "Orleans is 40 percent higher than the statewide average, St. Bernard is 30 percent higher, Jefferson 19 percent higher, and Plaquemines 15 percent higher.'

The commissioner told FOX 8 that Louisiana law is a big part of the problem. He said it allows a plaintiff to have a judge instead of a jury decide insurance settlements, up to $50,000.

Donelon said, "We've failed in our effort to do serious tort reform, such as lowering our highest-in-the-nation jury threshold."

He told us local judges are more likely to rule in favor of local plaintiffs and attorneys, rather than out-of-state insurance companies.

"I disagree with that premise," said FOX 8 legal analyst Joe Raspanti. "I don't question the integrity of the judiciary. As a plaintiff attorney I would love to have a jury come in at ground zero, because a judge caps me at 50,000.  I'd want the ability to have a better or bigger judgment."

The cheapest car insurance in the nation is in the state of Maine.  Its drivers pay roughly one-third the cost of a Louisiana insurance premium, and experts site a number of reasons.

Maine is mostly rural, and sparsely populated.  Also a Maine driver under 18 can't carry passengers who aren't family between the hours of midnight and 5:00 a.m. It has made for insurance costs of around $930 a year, compared to $2700 a year in Louisiana.

New Orleanian Darian Williams was paying $3600 a year for car insurance, but now chooses the streetcar.  But not everyone has that option.

Researchers with insure.com say the cheapest car to insure in the state is the Jeep Patriot.  The most expensive is the Mercedes Benz S65 sedan.

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