A business-based coalition that wants Maryland drivers to have a no-fault insurance option announced yesterday that it will campaign for legislation that would give consumers a choice between standard insurance coverage and no-fault.
The Citizen Choice Coalition -- which includes community groups and was organized by the Maryland Chamber of Commerce at the suggestion of insurance companies -- believes that the option plan will bring insurance rates down an average of 20 percent for those who choose basic coverage under the no-fault plan.
Those consumers, however, would give up the right to sue for pain and suffering. They would be reimbursed by their insurance company for medical bills and lost wages within 30 days, no matter who was at fault in the accident.
No-fault policies typically pay medical costs and lost wages but they deny the consumer the right to sue in accidents that are not considered severe.
The theory behind the plan is that auto rates are high largely because so much money is spent bringing cases to court. The no-fault option, the coalition says, would settle cases promptly and wring legal costs from the process.
"The coalition's main proposal is to ease the burden of high rates for individual drivers," said Peter J. Lombardi, president of the Maryland Chamber of Commerce.
August P. Alegi, group vice president for the Government Employees Insurance Co. (GEICO), said the insurance-choice plan "puts consumers in control."
"If you love your lawyer, if you love litigation, if you think suing people is America's favorite indoor sport, fine," Mr. Alegi said. But he said the insurance-choice plan, which he said is working in such states as New Jersey and Pennsylvania, will improve coverage and lower costs.
But the head of the Maryland Trial Lawyers' Association, a staunch opponent of no-fault insurance, disputed the coalition's claims.
"They're calling it consumer's choice," said Jonathan Schochor, president of the trial lawyers' association. "A public relations firm LTC came up with that name because they couldn't sell it as no-fault."
Mr. Schochor said a no-fault plan deprives consumers of their right to trial by jury. "What no-fault does is reward negligent drivers who cause injury to others, because it removes the concept of accountability and responsibility on the highways."
The lawyers' group last summer created a Task Force on Automobile Insurance and Medical-Legal Rights. The group is due to report by the end of the year, about the time a gubernatorial commission studying auto insurance plans is to send its recommendations to the governor.
In addition, a national group called New Start is circulating petitions supporting the consumer-choice proposal.
At the State House, any insurance bills likely would go to the House Committee on Economic Matters, chaired by Delegate Casper R. Taylor Jr., D-Allegany.
Yesterday, Mr. Taylor said he is interested in seeing a consumer-choice proposal because "we're all very frustrated over the continuing rise in the cost of automobile insurance, especially in the metropolitan areas. And in that frustration many different groups are coming together to try to find solutions."