Technical Advisory #359

LDI Bulletin 2024-02 – UMBI Coverage for Commercial Autos
Act 770 of the 2024 Regular Session of the Louisiana Legislature, eliminated the requirement to sign an
uninsured motorist (UM) selection form to reduce UM limits or reject UM coverage on commercial
automobile insurance. (Please note that the UM selection form is still required for personal automobile
insurance.) Commercial automobile insurance policyholders can now select UM coverage if they want to
buy it, and do not need to do anything to reject UM coverage. However, Act 770 specifies that:
“…for commercial automobile insurance policies, the insured shall have the option of selecting
uninsured motorist coverage on a form promulgated by the commissioner. If there is no selection of
uninsured motorist coverage on the form provided to the insured and no payment of premium that
includes this coverage, then it shall be presumed that no uninsured motorist coverage was selected for
that policy or contract, and the provisions of this Section shall not apply.”
LDI Bulletin 2024-02 advises all property & casualty insurance companies that LDI is in the process of
promulgating a new form to comply with this new requirement in the law, but since the Administrative
Procedures Act requires a lengthy process of promulgation, and the law became effective August 1,
2024, insurers are instructed to use the existing UM selection form until the new form is published by
LDI. You can find the form along with LDI Bulletin 2024-02.
New Rebuttable Presumption That UM Selection Form is Valid
Louisiana courts have repeatedly found UM selection forms invalid for a host of minor technical reasons,
forcing insurers to pay UM claims when premiums were never paid, and creating significant E&O liability
claims for insurance agents. IIABL and others have repeatedly changed the UM statutes and the UM
selection form over the years to reduce or eliminate these technical challenges.
A second provision of Act 770 of the 2024 Regular Session of the Louisiana Legislature adds a new
provision to limit the ability of the courts to invalidate UM selection forms:
“If the form is signed but not properly completed, such that the rebuttable presumption does not
apply, there shall be no uninsured motorist coverage or modified uninsured motorist coverage, as
applicable, if it is determined that the insured or his representative intended to reject or modify the
uninsured motorist coverage.”
There have been numerous UM selection form litigation cases where the policyholder admitted that they
intended to reject coverage, but the court vacated the form and found coverage anyway. This new
statutory provision should allow the form to remain valid if it is shown that there was an intent to reject
coverage.
IIABL Bill Requires Insurers to Validate & Maintain UM Forms
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IIABL asked Representative “Big” John Illg to introduce HB 511 in the 2024 Regular Session of the
Louisiana Legislature to protect IIABL members from some aggressive tactics by a few insurance
companies. The bill became law as Act 381 and will become law on April 1, 2025.
Agents have always been responsible for obtaining UM selection forms from policyholders. But over the
years, some insurers have pushed 100% of the responsibility for UM selection forms onto agents. Under
Louisiana law, the UM selection form becomes part of the policy, whether or not it is attached to policy
delivered to the policyholder. Whether UM coverage exists or not is 100% dependent upon the UM
selection form. Some insurers stopped reviewing and validating UM selection forms or maintaining a
copy of the UM selection form for their records. Instead, these insurers would require the agent to
produce a UM selection form at the time of an accident, many years after a policy is written. If the agent
cannot produce the form, or the form has a technical mistake which may make the form invalid, and the
insurer is forced to pay a UM claim, some insurers then subrogated against the agent to recover the UM
payment. IIABL believes that it should be the responsibility of the insurance company to validate and
maintain a copy of the UM selection form that is part of their policy contract with the policyholder. It is
inappropriate to force this responsibility on the agent.
Act 381 eliminates this problem for agents. The new law provides that:
“An insurer may require the producer of record to obtain a completed selection form and deliver the
form to the insurer; however, the insurer shall verify that the form is properly completed, retain a
copy of the form as part of the policy, and shall not delegate this obligation to retain a properly
completed form to the producer of record.”

• Inform Commercial Staff: Explain that UM forms are no longer required on commercial auto policies. Reinforce the importance of continuing to document policyholder’s decision and the options offered for E&O purposes.
• Use Existing UM Forms: On commercial, continue using the current UM selection form for selection of lower limits until LDI publishes a new one.
• Reinforce existing law with Personal Lines Staff: There has been no change to personal lines. Reinforce the importance and procedure of existing UM forms with personal lines staff.
• Document Intent: Carefully document clients’ intentions regarding UM coverage to protect against potential E&O claims.
• Monitor Insurer Practices: Beginning in April of 2025, insurers are required to maintain UM forms in their systems, rather than delegating that responsibility to agents. If an insurer attempts to delegate that responsibility, reach out to LDI or IIABL to help address the issue.

The information provided by IIABL is intended for educational and informational purposes only. IIABL does not make any warranty or representation, express or implied, with respect to the accuracy, completeness or usefulness of the information provided. Information provided represents the views of one or more experienced insurance professionals and is not a recommendation that a particular course of action be followed.  Please note that this information is not legal advice upon which you should rely. Please seek any legal opinion you may need from a qualified attorney. IIABL is not liable for any liability or damage which may result from the use of this information.