This bill amends Louisiana's motor vehicle insurance laws, specifically R.S. 22:1284.1, to address lapses in required liability insurance coverage. It prohibits insurers from increasing premium rates or adding surcharges based solely on an insured's first lapse in coverage, provided that the lapse does not exceed ninety days. The bill also stipulates that any subsequent lapse may result in increased rates or surcharges. Additionally, if an insured maintains continuous coverage for five or more consecutive years after a lapse, the first subsequent lapse will be treated as a first lapse for rate purposes. The definition of "lapse in coverage" is clarified to mean any period during which liability coverage is not maintained as required by law.

Furthermore, the bill repeals R.S. 22:1284.1(B), which previously contained provisions regarding lapses in coverage. It establishes that one or more lapses in coverage cannot be the sole reason for an insurer to deny a policy application or to determine rates for a policy. Insurers are also prohibited from requiring coverage from another insurer solely based on a lapse in coverage. The act is set to take effect on January 1, 2026, unless vetoed by the governor and subsequently approved by the legislature.

Statutes affected:
HB496 Original: 22:1(A), 22:1(B)
HB496 Engrossed: 22:1(A), 22:1(B)
HB496 Reengrossed: 22:1(A), 22:1(B)
HB496 Enrolled: 22:1(A), 22:1(B)
HB496 Act 476: 22:1(A), 22:1(B)