Insurance alternatives

After years of having thwarted legislative reform in Annapolis, it's hard not to view with skepticism an industry-initiated partnership with local civic groups to bring down the cost of automobile liability insurance in Baltimore. And yet the plan, which essentially would involve new legislation to allow drivers to choose between the current tort liability system of coverage and so-called "no-fault" policies, may be just the sort of compromise that both the insurance industry and its critics can agree on.

Under "no-fault," insurers pay for medical bills and lost wages within 30 days regardless of who is a fault in an accident. Policyholders in return give up the right to sue for "pain and suffering." The theory is that rates are high because so much is spent bringing cases to court. A system that wrung the legal costs from the process could result in average savings of as much as 20 percent on the annual cost of insuring a car in Baltimore.

The industry-initiated "no-fault" plan comes on the heels of a grass-roots citizens' drive to bypass the major insurers altogether by empowering Baltimore city to establish a publicly owned municipal corporation to write policies. Earlier this year, organizers of that effort persuaded Mayor Schmoke's office to underwrite half the $52,000 cost of a feasibility study, but so far they have failed to raise the other half in private matching funds. Even so, the seriousness of the grass-roots effort may have lit a fire under the industry to come up with practical alternatives.

Let's hope both efforts keep on track. Parallel drives for reform on both fronts increase the likelihood that one of them will actually succeed in creating a viable alternative to the present unacceptable system.