Insurance commissioner blames governor's administration for OMV - WAFB 9 News Baton Rouge, Louisiana News, Weather, Sports

Insurance commissioner blames governor's administration for OMV collection letters

Louisiana Insurance Commissioner Jim Donelon Louisiana Insurance Commissioner Jim Donelon

Louisiana Insurance Commissioner Jim Donelon is blaming Gov. Bobby Jindal's administration for the "notices of delinquent debt” issued by the Office of Motor Vehicles.

"These notices are an attempt by the Jindal administration to plug a hole in the state’s budget,” Donelon said in a written release.

He is condemning the move, which caused more than a million people to receive debt collection notices. He said the way the issue is being handled is "fundamentally unfair.”

According to the written release, the Department of Insurance has received lots of inquiries and complaints about the notices, but Donelon said his department does not have the information to determine whether people were insured five or 10 years ago.

Read the entire news release below:

Insurance Commissioner Jim Donelon condemned a move by the state Office of Motor Vehicles that has hit Louisiana citizens with 1.2 million debt collection notices. "These notices are an attempt by the Jindal administration to plug a hole in the state’s budget." Donelon said.

"Yes, we want all drivers to be insured because when more drivers are insured, auto insurance rates can go down. But the way that this has been handled is fundamentally unfair. For years the state has failed to collect fines. Now, years later, the average citizen likely does not have the documents to prove that they had insurance one way or the other. No one keeps proof of insurance from a decade ago," Donelon said. "How can any reasonable person defend themselves from an alleged infraction 10 years ago? And why should any of us assume that the records are accurate and correct?" Donelon asked.

Donelon said he received a call from a veteran of the Iraq war who was deployed for some time on active duty when that service member’s auto insurance expired, according to state records. "Now, ten years later the state wants to fine this veteran over $600 and she has no ability to prove whether the state’s assertion is correct. I think most people think this is outrageous, and I wonder if the state has effectively deprived many of its citizens of their legal rights," Donelon said. "The administration also retroactively applied a recent increase in the penalty for not having insurance to people whose alleged infractions happened before the Legislature voted to increase the penalty. I question whether that is even legal," Donelon said.

The Louisiana Department of Insurance has received numerous inquiries and complaints from constituents about the notices from the Office of Motor Vehicles, although the Department of Insurance has no authority to resolve the complaints or provide information to consumers to help them prove whether their vehicles were insured or not. "Consumer protection and assistance is a priority for me and I wish we could help people sort through this mess, but I don’t have the information that they might need to prove they were or were not insured 10 years ago, or five years ago, for that matter," Donelon said. "We have been in contact with the Office of Motor Vehicles and have been told they are making adjustments to better handle consumer calls but in the interim, consumers can also call the Governor’s office," Donelon added.

The Department of Public Safety sent out 1.2 million letters informing people that sometime along the way their car insurance had lapsed in Louisiana and they now owe a fine. The fine can range anywhere from $125 to $525, and if not paid in 60 days, the letter says a person’s tax refund "will be seized." 

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