PHOENIX β A Senate panel endorsed increasing the amount of liability insurance motorists must purchase to drive on Arizona roads, rebuffing claims it would harm some low-income people.
The 6-1 vote Tuesday by the Senate Committee on Transportation and Technology came over the objections of state Sen. David Farnsworth, R-Mesa.
βA lot of folks live paycheck to paycheck,β he said. βThere are people out there right now that are faced with either a permanent or probably a temporary situation where they have to choose between paying the electric bill or paying their mandatory insurance.β
Farnsworth said the result of the legislation, SB 1075, would be more people choosing to flout the legal requirement to have liability insurance. And that, he said, would mean more motorists on state roads who have no insurance at all to compensate those they kill, injure or whose property they damage.
But bill sponsor Sen. Kate Brophy McGee, R-Phoenix, said it is precisely those at the bottom of the income scale her measure is designed to help. She said these are the people with the least amount of personal resources to call on when they are injured or their car is totaled by someone else who doesnβt have enough insurance to cover the damages they caused.
Tuesdayβs vote in no way assures the measure will become law. Similar legislation was approved by the full Senate last year, only to be held up when Rep. David Livingston, R-Peoria, refused to give it a hearing in the House Banking and Insurance Committee he chairs.
Current law requires motorists to carry so-called 15/30/10 liability insurance: $15,000 to cover injuries to any one person in an accident, $30,000 for all injuries from the same mishap, and $10,000 for property/vehicle damage.
Brophy McGee said those limits were enacted in 1972. There was a presumption they would be adjusted to keep pace with the cost of medical care and even the increasing price of vehicles, she said.
That, however, has not happened, with the insurance industry in opposition amid concerns that the higher premiums will equal fewer people buying coverage.
Her measure would boost the minimum to $25,000 for injuries to one person, $50,000 for all injuries, and $25,000 for property damage.
David Childers, who lobbies for the Property and Casualty Insurance Association of America, argued thereβs no reason to believe the higher limits are necessary. He said the average liability claim for injuries is about $13,700 and for property damage, in the $3,000 to $4,000 range.
But attorney Geoff Trachtenberg told lawmakers the figures are misleading.
He said they represent the amounts for which a claim was settled. And, by definition, if someone has only $15,000 worth of insurance, the claim will settle within those limits.
Brophy McGee said figures gathered by the state Department of Transportation put the actual losses in a motor vehicle accident resulting in death in excess of $1.5 million. For other injuries, she said, the figure approaches $93,000.
She said the typical property damage done exceeds $11,500.
Trachtenberg acknowledged the cost of increasing liability coverage to the proposed new limits is expected to be about $91 a year for motorists who now buy the minimum.
