S.D. Senate Rejects Effort to Repeal Household Exclusion Law

February 1, 2002

The South Dakota Senate defeated legislation earlier this week that would have eliminated the household exclusion from automobile insurance policies and created a new mandated coverage. The household exclusion prevents individuals within the same household from suing each other as a result of an automobile accident.

“Senate Bill 121 created a new mandated coverage and could have caused auto insurance premiums to jump 20 percent,” said Laura Kotelman, counsel for the National Association of Independent Insurers (NAII). “The bill would have created administrative problems for agents, opened the door for the trial bar to generate additional lawsuits and led to increased insurance costs and higher premiums for consumers.”

Based on Insurance Research Council figures from a national claims survey, the average payment to a family member living in the same household is 21 percent higher than the average payment to a third-party claimant.

Topics Politics

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