During the 2024 Regular Session of the Louisiana Legislature, the Louisiana Department of Insurance (LDI) asked Senator Mike Reese, Republican from Leesville, Louisiana, to sponsor SB 499 / Act 770 regarding UM selection forms.
The original bill would have eliminated the mandate for UM coverage equal to liability limits and the UM selection form. It would have made UM coverage just like other optional auto coverages…buy it if you want it, and don't buy it if you don't want it. IIABL was in strong support of the original bill because it would eliminate the problems and liabilities that agents face from UM selection forms.
Unfortunately, the legislature worried that personal automobile policyholders would not understand the importance of UM coverage, particularly in a state where a $15,000 minimum limit leaves many drivers underinsured. SB 499 was amended in the Senate to limit the scope primarily to commercial automobile insurance. Commercial auto policies will no longer require UM selection forms to reject coverage (or reduce limits). Instead, commercial auto policyholders may elect to buy UM coverage by completing a form promulgated by LDI requesting the coverage. If the commercial policyholder did not request UM coverage and did not pay a premium, there is no UM coverage.
This is a significant improvement in the determination of UM coverage on commercial auto policies and should benefit agents.
SB 499 had a secondary provision that applies to personal auto policies and UM selection forms. If a UM selection form has a technical error, but it is determined that the policyholder intended to reduce or reject UM coverage, there shall be reduced or no UM coverage on the policy. This provision will hopefully result in court cases that render a fair determination of whether UM coverage should be provided and eliminate the technical exceptions that put agents in harms way.
IIABL is grateful to Commissioner Temple and the folks at LDI for introducing and passing SB 499.