Expanding auto policy coverage

LINCOLN — Most Nebraskans probably think their auto insurance covers their family members in an accident.

State Sen. Scott Price of Omaha did — until the Legislature took up a bill that would require insurance companies to provide such coverage.

He soon learned that the state's “guest” law bars passengers from getting insurance payments when they are injured in a vehicle driven by a relative.

The law applies when that relative causes an accident.

“I believe most people believe all occupants were covered under the same rules,” Price said.

He was among 26 lawmakers who voted Friday to give first-round approval to Legislative Bill 216. Sixteen senators voted against advancing the bill.

State Sen. Norm Wallman of Cortland, who introduced the measure, said current law creates inequities.

For example, a live-in girlfriend could recover if she was injured in a motor vehicle accident caused by her boyfriend, but a wife could not, he said.

Insurance would pay for injuries to a son's friend, but not the son, in an accident caused by the boy's mother.

Wallman said a constituent brought the problem to him after being hurt in a rollover accident and hospitalized for a week.

The constituent was a passenger in a pickup driven by a relative. He discovered he could not recover from the driver's insurance because of the guest law.

Wallman said the man was left with large out-of-pocket costs because he had only a high-deductible health insurance policy.

Opponents called the bill a government mandate and said it would increase the cost of auto insurance.

Sen. Tom Carlson of Holdrege said premiums could go up by 3 percent to 5 percent per year if the bill passed. As the premiums rise, more people will go without insurance, he said.

Sen. John Nelson of Omaha said people can buy a rider on their auto insurance if they want to make sure their family members are covered.

But bill supporters said few people know they would need such a rider to have their relatives covered.

Sen. Brad Ashford of Omaha termed the current law an “oddity” and a “holdover.” Nebraska is one of only nine states with such an exclusion.

The current law excludes spouses, parents, grandparents, children, grandchildren and siblings and in-laws from coverage.

Until 1981, when senators changed the law, Nebraska excluded any nonpaying passengers from being covered.

LB 216 also would repeal a similar exclusion for relatives of airplane pilots.

Contact the writer:

402-473-9583, martha.stoddard@owh.com

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