Colorado's no-fault auto insurance requirement will sunset on July 1, but the state isn't in a rush to get rid of it entirely.
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There is legislation on the table that
will allow consumers to choose between no-fault insurance and regular
tort, the latter of which allows consumers to sue for pain and
suffering. Currently, Colorado drivers are required to carry $130,000
worth of personal injury protection. If the "choice" bill is adopted,
consumers can choose the amount of coverage they want, at a minimum of $10,000.
"Insurance companies say the consumers
will save money because they can opt for lower coverage, which carries
lower premiums," says Deborah Collette, public affairs director for
Colorado's Department of Insurance. "The trial lawyers, who are on the
other side, say that $10,000 would be eaten up by medical bills in
three days or less, and that people won't be properly protected."
Collette says critics of the no-fault
plan that allows consumers to choose the amount of coverage is a way
for auto insurers to shift costs to health insurers.
"Once the personal injury coverage on an auto policy is exhausted, then the health insurance would kick in," says Collette.
Insurers believe having a choice will
make auto insurance affordable for low-income families, reducing the
number of uninsured motorists. In addition, it will still allow people
to sue on the basis of fault for unrecovered noneconomic losses.
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