Auto Insurance
Whitman and New Jersey Senate Reach Car Insurance Compromise
The State Senate and Gov. Christine Todd Whitman agreed tonight on a compromise auto insurance plan that promises a 15 percent rate reduction for most motorists but puts off until 2000 the highly contentious issue of how much more urban drivers can be charged.
The compromise was drafted to satisfy Assembly Speaker Jack Collins, who had demanded that the current law’s cap on premiums paid by urban drivers be eliminated. The compromise, which keeps the cap in place for two more years, was immediately taken to the Senate, which approved it tonight.
The measure must be approved by the Assembly, which could meet on Thursday.
In general, the measure would reduce rates for suburban and rural drivers by cracking down on insurance fraud and limiting the amount drivers can win in liability lawsuits. The measure would also give new and broad powers to the State Commissioner of Banking and Insurance to draw the lines between suburban and nonsuburban insurance districts, as well as to restrain rate increases for urban drivers.
‘’It is our best chance to end a system that puts special interests and scam artists ahead of consumers,'’ Governor Whitman said.
The bill would also permit motorists to save money by buying much less personal injury coverage than the $250,000 minimum currently required, and by other coverage options. Senate President Donald DiFrancesco said the new measure, worked out with Governor Whitman, would meet the original goal of reducing average insurance costs by 15 percent. But Mr. DiFrancesco conceded that he did not know how the changes in the urban-suburban districts and the additional coverage options would affect the rates for individual drivers.
More : query.nytimes.co
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