Auto insurance anti-stacking language causes disagreements between insurers and lawyers

Insurance Industry NewsFollowing an April vote by Wisconsin lawmakers that permitted the inclusion of anti-stacking language in auto insurance policies, it is anticipated that one of the first acts from the Republican-controlled state legislature will be a decision to permit insurers to disallow policy stacking.

The decision in April was made in an attempt to resolve a common battle that was regularly being fought between trial lawyers and insurers. What occurred was the repealing of every element of the “Truth in Auto” law that was passed in 2009, except for the aspect that made auto insurance mandatory. Beyond the anti-stacking language element, the April 6 revisions to the law also decreased the minimum requirements for auto insurance to those of 1982.

The argument made by trial lawyers was that in circumstances of catastrophe reducing clauses and stacking may make the difference between whether victims of accidents who are policyholders will be able to cover the expenses or whether they will face bankruptcy.

On the other hand, the insurance companies have made the argument that changing the 2009 rules would cause policyholders to have to pay higher premiums and a greater number of people would not be able to afford insurance, having to go without.

Both lawyers and insurers placed a great deal of money and effort in their attempt to influence the state’s Legislature. According to MapLight – a nonpartisan political money tracker in California – data, both industries dumped a minimum of $336,319 into their state legislator campaigns.

A Wisconsin Center for Investigative Journalism analysis also showed that both industries also poured almost $1.1 million into their 2009 and 2010 lobbying efforts, a great deal of which went toward the auto insurance battle.

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