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Jul 17, 1997
New Report Shows Insurance Premiums in No-Fault States Continue to Soar
Repealing No Fault Fastest Way To Lower Price of InsuranceBeleaguered motorists in no fault states have seen their insurance premiums increase an average of 45.6% between 1989 and 1995, according to a new study of insurance industry data released today by California's Proposition 103 EnforcementProject and national consumer group Public Citizen. This is nearly one-fourth faster than the average premium increase in states without no-fault. The study's release coincides with today's U.S. Senate Commerce Committee hearing to consider legislation to impose a so-called auto "choice" no-fault system on motorists nationwide.
Prop. 103 Enforcement Project director Harvey Rosenfield, who is testifying at today's hearing, said "After nearly twenty-five years of experimentation with no fault throughout the country, the only conclusion that can be drawn is that this grossly unfair system is an absolute failure. The best way to lower auto insurance premiums is to limit the profiteering and inefficiency of insurance companies, as California did eight years ago."
According to Public Citizen President Joan Claybrook, "Auto choice makes good drivers pay for bad drivers. It is a testament to the massive power and pervasive influence of the insurance industry that no-fault has suddenly appeared on the congressional agenda, while remaining in effect in some states where beleaguered motorists want to escape its costly tyranny."
The study summarizes data drawn from annual reports published by the National Association of Insurance Commissioners, State Average Expenditures & Premiums for Personal Automobile Insurance in 1995 (January 1997). Among the findings are:
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