How Would a ''Choice'' Auto Insurance Plan Affect the Insurance Costs and Compensation of Accident Victims?

by Lloyd Dixon

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This research brief describes work documented in The Effects of a Choice Automobile Insurance Plan on Insurance Costs and Compensation: An Analysis Based on 1997 Data (MR-1134-ICJ).

Excerpt: Escalating auto insurance premiums have been a major public policy issue at the state level for the last three decades. No-fault auto insurance, born in the 1960s, was one response. It offered cost savings and speedier, more certain compensation to auto accident victims. But because it limits claimants' ability to seek compensation through the courts, most states have found it an unappealing alternative. Choice auto insurance, initially proposed in 1986, addresses this concern by allowing drivers to choose between a no-fault plan and a somewhat modified version of their state's current auto insurance plan.

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