Costly Auto Insurance Mandates
in Governor’s Budget
Issue Brief
Impact of Governor’s Mandates:
Forces families to pay over 33% more for auto insurance they don’t need.
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Mandates regressive costs that would fall most heavily on low- and middle-income families.
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Drives Wisconsin from the 3rd lowest cost auto insurance state to one of the highest cost states.
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Increases the number of uninsured motorists.
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Establishes Wisconsin as the state with the highest mandatory limits in the nation. Only four states even require
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limits greater than Wisconsin’s current limits.
Wisconsin’s current 25/50/10 limits are sufficient to cover over 90% of all claims. This bill forces consumers to
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purchase thousands of dollars of unneeded coverage.
Premiums will increase under this bill. Wisconsin “solvency” regulations require insurance companies to charge
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premiums that reflect risk to maintain the financial stability to pay claims.
Regressive Mandate on Low-and Middle-Income Families:
Responsible low- and middle-income families paying the current minimum auto insurance levels would see their
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costs rise 33% to 43%. High income families who already choose higher coverage levels would be less affected
but would still see premium increases.
Families would pay between $96 and $309 more for insurance with the largest dollar increase falling on families
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in the Milwaukee area.
Rural families, especially in western Wisconsin, would have the highest percentage increase in their premiums.
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Low- and middle-income families bear a disproportionate share of the current economic crisis in terms of plant
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closings, layoffs and home foreclosures. These regressive cost increases mandated in the Governor’s Budget
would hit them hardest.
Increases Cost through Unnecessary Mandates:
Mandates “stacked” insurance policies – This provision mandates that families pay extra to allow coverage limits
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from vehicles not involved in an accident to be “stacked” on the insurance for the vehicle in an accident.
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