---

Business Leaders Endorse Auto Choice Legislation

10 April 2000

Business Leaders Endorse Auto Choice Legislation; Coalition for Auto-Insurance Reform Urges Congress to Act

    ALEXANDRIA, Va., April 10 The Coalition for Auto-Insurance
Reform praised the Committee for Economic Development's endorsement of Auto
Choice insurance legislation as a win-win proposal for consumers and
businesses.
    CED, a group of national business leaders and educators, recommends Auto
Choice legislation as an alternative to what it calls the nation's "litigation
lottery," a system which pays nearly three times as much for lawyers and fraud
as for the economic losses of injured persons.
    Under Auto Choice, motorists could opt out of the litigation lottery and
instead buy low-cost insurance that compensates them promptly for their
medical bills and lost wages, and protects them from claims for non-economic
losses by other drivers.
    Peter Kinzler, President of the Coalition for Auto-Insurance Reform, which
represents consumers and businesses, urged Congress to pass pending Auto
Choice legislation -- S. 837 and H.R. 1475.  "It is not too late to give the
American public what would amount to an election year tax cut," Kinzler said.
"It would put money directly into the pockets of motorists and have no impact
on the federal budget."
    Kinzler said, "The litigation system is so expensive that the Auto Choice
reform could provide both lower premiums and better compensation for serious
injuries."
    Congress's Joint Economic Committee estimated premium savings for drivers
who select the new insurance option at $184 per car per year.  If all
motorists elected the new option, total savings would be approximately $35
billion per year.
    "The greatest benefit," Kinzler emphasized, "would go to low-income
people, who today spend 16 percent of their income on auto insurance.  Too
often, this forces them to defer payments for food, rent and other
necessities."
    "For a low-income family," Kinzler said, "the 36 percent reduction in
premiums, estimated by JEC under Auto Choice, would be the equivalent of five
weeks of free groceries or nearly four months of electric bills."