A bill that would have created special insurance coverage for low-income Colorado drivers was defeated on the House floor. H.B. 1089 would have established a reduced-limits auto policy for low-income consumers, similar to a bill that was recently passed in California.
Although the bill did not include a mandatory offer, insurers were concerned that it would be amended to make it a mandatory offer, according to Michael Harrold, Northwest regional manager for the National Association of Independent Insurers. NAII opposed the measure.
“The Colorado House made a wise decision when it voted down this bill,” Harrold said. A low-cost auto bill is especially unnecessary in Colorado, where state law already exists to offer reduced coverage to low-income drivers, he said.
The current law allows insurance companies to equitably price the low-income policies, while H.B. 1089 would have required insurers to give preferred rates to all low-income drivers. “Mandatory systems are both actuarially unsound and unfair because they create a system where good drivers subsidize bad ones.”
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