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MONTHLY REPORT
Volume 13, Issue 4
April 2013


Members

Commissioner Jim Donelon
Theodore "Ted" Haik, Jr., Chair
Jeff Albright, Vice Chair

Raymond J. Aleman, Sr.
Lee Ann Alexander
J.E. Brignac, Jr.
Paul Buffone
Stephen F. Campbell
Anne Cassity
Sheriff Greg Champagne
Representative Greg Cromer

Manuel DePascual (Alternate)
Louis G. Fey, Jr.
Michael Guy
Lance "Wes" Hataway
Ron Henderson
Senator Eric LaFleur
Scott Landry
LTC John A. LeBlanc
Ann Metrailer (Alternate)
Robert Moorman
Senator Dan "Blade" Morrish
Chris Roy, Jr.
Representative Kirk Talbot
Earl Taylor


Staff


Terrell B. Moss, Director

David Evans,
Supervisor/Research Analyst

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2013 Regular Session – P&C Bills of Interest

This year’s Regular Session of the Louisiana Legislature convened April 8 and must adjourn no later than June 6. In conformity with the law, as an odd-numbered year the primary focus of this session is on fiscal and local matters. However, legislators may file a limited number of general subject matter bills.

Here is some of the proposed legislation pertaining to property and casualty issues:

HB 71 – Requires that law enforcement officers during traffic stops verify within their capacity that the proof of motor vehicle insurance/security document in the vehicle is current. 4/23: Subject to Call – House final passage.

HB 104 – Extends the current 25% auto liability insurance premium discount received by active military personnel based in Louisiana to members of the LA National Guard and military reserves. 4/17: Considered by House Insurance – Voluntarily deferred.

HB 543 – Provides relative to the regulation of surplus lines insurance, including: authorizing placement of personal lines insurance with surplus lines insurers without regard to the availability of coverage through admitted insurers; eliminating the producer’s affidavit attesting to his diligent efforts to place personal lines coverage with the admitted market and certain disclosures to the applicant in favor of a certificate by the applicant acknowledging the disclosures; and amending surplus lines insurers’ capital and surplus requirements in recognition of the federal Nonadmitted and Reinsurance Reform Act of 2010. 4/29: Pending Senate Insurance.

SB 19 – Prohibits Louisiana Citizens Property Insurance Corporation from assessing an annual rate increase for any parish in excess of 25% without approval from the House and Senate committees on insurance. Upon the committees’ approval, the Commissioner may implement the increase over two to five years. 4/23: Pending House Insurance.

SB 100 – Requires homeowners’ insurers who use a named-storm or wind and hail deductible – rather than a hurricane deductible – to offer the policyholder a discount on the annual premium. 4/17: Considered by Senate Insurance (adjourned).

SB 147 – Prohibits any device from being used to access, read, or post to a social networking site while operating a motor vehicle and requires the driver’s license test to include distracted driving questions. 4/22: Pending House Transportation, Highways, and Public Works.


Update: Distracted Driving

Distracted driving has been defined as any activity that takes your eyes off the road, your hands off the wheel, or your mind off your primary task of driving safely. As such, distracted driving continues to present challenges to improved highway safety. Various studies have quantified it as a crash risk, data continues to be compiled on it as a crash cause, and laws continue to be promoted and enacted to discourage it. Yet, it still remains difficult to attribute it as the cause in many crashes, because of general reliance on driver self-reporting. It is equally difficult to implement enforceable laws that prevent the behavior.

Texting
Take texting while driving. It would seem self-evident that all drivers should avoid this action since it diverts the eyes, hands and mind, as is confirmed by the studies. According to a 2012 National Highway Traffic Safety Administration (NHTSA) survey that was released earlier this month, 94% of respondents supported a ban on texting while driving and, on average, at least a $200 fine for the offense. A 2009 Virginia Tech Transportation Institute study found that the risk of a crash is 23 times higher when texting while driving.

For most states the laws are there, too. Text messaging is banned for all drivers in Louisiana, 38 other states and the District of Columbia. Six of the remaining states ban texting for novice drivers. Two of the total-ban states have toughened their laws this year in hopes of improving enforcement.

Maryland, which had a ban on hand-held cell phones as a secondary offense, passed a bill earlier this month that will make use of a hand-held cell phone a primary offense and increase the fines effective October 1. This should aid enforcement of the texting ban, as well, because police will be able to stop and ticket any driver seen with a cell phone in hand.

Virginia passed a law earlier this year that raises texting while driving to a primary offense and dramatically increases the fine from $20 to $125 for a first violation and $250 for a second. Since it has no hand-held cell phone ban on drivers age 18 or older, enforcement may be difficult. Can an officer readily determine whether a driver is lawfully dialing his phone or accessing GPS or unlawfully texting? Still, some Virginia enforcement agencies were undaunted even before the texting ban became a primary offense. It has been reported that the Fairfax County police issued fewer than 100 texting tickets over the most recent three year period, while ticketing over 27,000 under a distracted driver ordinance for failure to “pay full time and attention.”

Other Distractions
While texting and cell phone use remain a primary focus of study and legislation, they are not the only driving distractions. NHTSA maintains a nationwide census of fatal crash data from police reports. Erie Insurance, in consultation with the Insurance Institute for Highway Safety, examined NHTSA’s 2010 and 2011 fatality data as it pertains to distracted driving and recently released its analysis. Of the more than 65,000 people killed in car crashes over the two year period, one in 10 died in crashes where police reported that at least one of the drivers was distracted. Erie lists the top 10 distractions reported in these fatal crashes as:

  1. Generally distracted or “lost in thought” (daydreaming) – 62%
  2. Cell phone use (talking, listening, dialing, texting) – 12%
  3. Outside person, object or event (such as rubbernecking) – 7%
  4. Other occupants (talking with or looking at other people in car) – 5%
  5. Using or reaching for device brought into vehicle (such as navigation device, headphones) – 2%
  6. Eating or drinking – 2%
  7. Adjusting audio or climate controls – 2%
  8. Using other device/controls integral to vehicle (such as adjusting rear view mirrors, seats, or using OEM navigation system) – 1%
  9. Moving object in vehicle (such as pet or insect) – 1%
  10. Smoking related (includes smoking, lighting up, putting ashes in ashtray) – 1%

Awareness Month
April has been designated as National Distracted Driving Awareness Month. NHTSA and the National Safety Council, as well as many insurers and affiliated research groups, provide recommendations on preventing distracted driving on their respective websites.

 Weather Watch: Hurricane Season Forecast

Spring has arrived in Louisiana. Folks are busy in their yards cutting grass, planting flowers and vegetables, and enjoying the mild weather outdoors. On the horizon – hurricane season, which officially begins June 1st and continues through November 30th.

Several forecasters released their initial predictions this month. There appears to be general agreement at this time that 2013 will be an above-average season based on warmer tropical Atlantic waters and the predicted absence of El Niño and its inhibiting influence. Colorado State University (CSU) climatologists estimate a 47% chance of a major hurricane hitting the Gulf Coast (average for last century, 30%), a 48% chance for the East Coast (which includes all of Florida) (average for last century, 31%), and a 72% chance for the entire U.S. coastline (average for last century, 52%).          

  Named Storms Hurricanes Major Hurricanes
(Category 3 or higher)
AccuWeather 16 8 4
The Weather Channel 16 9 5
CSU 18 9 4
Average since 1950 12 7 3

We in Louisiana have had plenty of experience in recent years with the destruction and death a hurricane can inflict. We have been reminded by last year’s Isaac that a prolonged period of Category 1 rain and wind can do plenty of damage, that the danger is not just from the storm surge, flooding, and wind of a Category 3 Katrina/Rita.  Further, note that the continued tolling of the insured losses (now projected at $20 billion) of the Northeast’s Sandy, which was a Category 1 downgraded to “post-tropical” at landfall, will place it as the third most costly hurricane behind Katrina ($48.8 billion) and Andrew ($25.6 billion).

For these harsh reasons, may hurricane season never find us complacent or ill-prepared. In these balmy spring days, consider reviewing your homeowner’s coverage, inventorying your personal property, and buying flood insurance. Remember, in most cases flood insurance does not become effective until 30 days after purchase.