The American auto insurance industry is moving forward with a policy of “free reign” in the United States, as a bipartisan coalition of senators introduced legislation Monday to repeal some of the nation’s most restrictive regulations on the industry.
The legislation would also prevent insurers from charging higher premiums for lower risk drivers.
The Progressive Insurance Association, the nation ‘s largest auto insurance company, is pushing the legislation because it fears the Trump administration will reverse a 2015 Obama administration policy that requires insurers to cover drivers who buy a car through a reinsurance program, and who are at least 65 years old.
“We believe that a lot of the changes that the Trump Administration is going to make to the reinsurance marketplace, we believe are going to hurt people,” said Andrew Tullman, senior vice president of communications for the American Insurers Association, which represents the industry’s most powerful trade group.
“The insurance industry believes that the reinsurers need to be protected.
They need to have a say.”
The bill would also end some of a program known as the Comprehensive Auto Insurance Plan, which offers cheaper auto insurance for people who have less than $15,000 in auto-insurance coverage, and that’s why the Progressive Insurance association lobbied for it.
It would also repeal a rule that requires insurance companies to cover people who can’t drive because of a condition such as diabetes, cancer or certain other health conditions.
The White House, which supports the reinsuring program, said Monday that the Progressive Association is out of step with the president, who has said that he wants the reinsurer program to continue.
“The Progressive Association has not endorsed any specific policy that could affect consumers,” said spokesman Michael Short.
“They support reinsurance as a way to protect consumers and help reduce the cost of premiums.”
The Progressive Automobile Association, whose members include insurers, manufacturers and retailers, has said in the past that the program is essential to protecting the auto industry, and it’s expected to join with the insurers and insurers’ trade groups in voting against the Progressive legislation.
The group also supports repealing the requirement that insurers cover people with disabilities.
The auto industry is still reeling from the financial crisis of 2008, and some insurance companies have sought to shift their business away from selling car insurance and towards other types of services.
Progressive, for example, has moved away from auto insurance in recent years, saying it no longer offers auto insurance and has instead turned to reinsurance to cover those with chronic health conditions, such as Parkinson’s disease.
The insurance companies that represent the Progressive Automobiles argue that the auto insurance program is crucial for the industry to survive.
The Progressive Association’s Tullmans said in a statement that the bill will make it harder for insurers to get into the auto insurers business, while the Progressive industry is “fearful” of changes to the auto reinsurance market that would make it less viable.
“Insurers should not be permitted to impose higher premiums on consumers and should not continue to be able to charge higher premiums to people who cannot drive, especially as a result of COVID-19,” the Progressive association said in its statement.
“This is the most fundamental change to the American auto insurer model in a generation.
This bill will stop this from happening.
This is the best way to keep the auto auto insurance market healthy.”