A public hearing will be held on Dec. 18 by the Council of the District of Columbia on a proposed bill that would increase minimum auto insurance coverage.

The “Motor Vehicle Insurance Modernization Amendment Act of 2024,” introduced by Council Chairman Phil Mendelson, would update coverage for the first time since 1986.

“In a vehicle collision, a person may be injured and might need medical care, time off work to recover, and more,” Mendelson wrote in his bill introduction. “All the components of this recovery cost much more today than in 1986 yet the same $25,000/$50,000 minimum insurance policy will apply.

“[T]he present value of $25,000 from 1986 is $70,483 in December 2023 (Bureau of Labor Statistics) and the present value for medical care is over $117,000. This minimum coverage is not keeping pace with the Consumer Price Index (CPI) nor the actual cost of medical services.”

Mendelson seeks to increase the District’s minimum insurance statute to $50,000/$100,000.

Mendelson noted the bill allows the minimum coverage amount to be tied to the CPI “to make sure that this insurance, used to pay for harm caused in an auto accident, keeps pace with the cost of those harms.”

“Insurance carriers may protest that this bill will increase premiums but state after state has rejected that claim,” he wrote. “Innocent victims of motor vehicle accidents have a right to recompense, and it is time the District enter the 21st century.”

District policyholders would also be required to elect either underinsured motorist (UIM) or enhanced uninsured motorist (EUIM) coverage and carriers would be required to offer both.

“With EUIM, an insured will receive the full benefit of their UIM coverage; the insurance carrier will not be able to take a credit for the at-fault driver’s insurance and reduce its payment to the insured,” Mendelson noted.

Mandatory minimum motor vehicle insurance requirements for property damage liability, third-party liability, underinsured motor vehicle, and enhanced underinsured motor vehicle coverage will increase by $5,000 on Jan. 1, 2028 and once every five years following.

“Our neighboring jurisdictions are leading the District on this issue,” Mendelson wrote. “The Maryland General Assembly updated their minimum insurance statute over a decade ago, in 2011, to the minimum limits of $30,000/$60,000, and this amount is quickly becoming outpaced by the cost of inflation.

“In the 2021 session, the Virginia General Assembly passed legislation to raise their minimum insurance to $30,000/$60,000 as of Jan. 1, 2022, with an automatic escalator to $50,000/$100,000 (the same amount contemplated in the attached legislation) on Jan. 1, 2025. In the 2023 session, the North Carolina General Assembly passed legislation to raise their minimum insurance to $50,000/$100,000 on Jan. 1, 2025.”

The public hearing will be held at 10:30 a.m. in Room 500 of the John A. Wilson Building and via Zoom here and at dccouncil.gov/hearings.

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