[Congressional Record Volume 143, Number 111 (Thursday, July 31, 1997)]
[Senate]
[Pages S8505-S8506]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




               S. 625--THE AUTO CHOICE REFORM ACT OF 1997

  Mr. NICKLES. Mr. President, I am happy to join as a cosponsor to S. 
625, the Auto Choice Reform Act of 1997. This bill enjoys wide 
bipartisan support for the choice that it offers every American when 
choosing car insurance. Under this bill, families and individuals will 
be able to exchange the right to bring certain lawsuits for a 
substantial savings on their automobile insurance. This bill will allow 
consumers the right to purchase a low-cost policy that will cover 
medical bills and lost wages but not pain and suffering damage claims. 
Those policies will also give the purchasers immunity from pain and 
suffering claims against them. The current State liability systems will 
remain intact as a choice for individuals who would prefer the freedom

[[Page S8506]]

to sue and be sued for pain and suffering damages.
  American taxpayers stand to save a total of $45 billion nationwide. 
This savings would go directly in the pocket of every insured person at 
no cost to the taxpayers. The Joint Economic Committee has projected 
that the auto choice option will save Oklahomans $420 million in 
automobile insurance premiums and will put $186 back into the accounts 
of every person with a car. This is the equivalent of an instant tax 
cut for every insured person.
  The New York Times stated that with this bill: ``Everyone would win--
except the lawyers'' that live off of the current liability system. In 
fact, trial lawyers take in an estimated $17 billion a year from auto 
accident cases. USA Today reported that 35 cents of every auto premium 
dollar goes to lawyers.
  This bill has been labeled a ``model of federalism.'' Each State has 
the right to opt out of auto choice if the State insurance commissioner 
finds that residents fail to receive at least a 30 percent reduction in 
bodily injury premiums. The State legislature retains the right to 
simply pass a law against this option and keep its current auto 
liability system.
  There is mounting evidence that the current auto liability insurance 
system has become prey to rampant fraud and abuse, which is constantly 
fed by inflated pain and suffering claims. FBI Director Louis Freeh 
estimated that the average household pays an additional $200 in 
unnecessary premiums just to cover these fraudulent schemes. This hits 
low income families particularly hard since about one-third of a 
family's disposable income is consumed by car insurance costs. Auto 
choice will put that money back into the pockets of taxpayers to help 
pay for needed expenses, providing long-overdue relief to all who 
choose this option.
  I am happy to cosponsor this bill and hope that every American with 
car insurance will be given the opportunity to make this choice to 
provide long over due relief to all who choose this option. It is time 
for all drivers to begin to enjoy lower auto premiums and to allow 
government to spend its resources outside of the courtroom.

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