ANNAPOLIS -- In probably its only public hearing this year, the issue of no-fault automobile insurance was squeezed through the wringer yesterday by legions of supporters and opponents, all of them looking for a way to reduce auto insurance rates.
Though more than 40 witnesses signed up to testify, the three-hour hearing before the House Economic Matters Committee was largely for show, some observers agreed, given the Senate's continued strong opposition to the concept of no-fault, in which drivers seek compensation for damages from their own insurers, regardless of who was at fault in an accident.
In exchange for giving up the right to sue -- and the high costs of involving lawyers -- drivers are promised lower rates.
The bill, called the Guaranteed Benefits Insurance Act of 1991, would create a "choice no-fault" auto insurance system.
Under the plan, drivers would be allowed to choose between no-fault and the current tort system, where accident victims are allowed to sue other drivers for medical costs, lost wages, property damage and pain and suffering damages.
Sponsored by Delegate John W. Douglass, D-Baltimore, the bill requires insurers to reduce rates by 25 percent of their statewide average premium for drivers who choose no-fault. That guarantee stays in effect for one year, after which insurers must receive approval from the insurance commissioner for any change in rates.
If a driver who remains in the tort system is hit by a no-fault driver, the victim would have to go to his own insurer for compensation under the uninsured motorist portion of his policy.
Disputes between no-fault drivers and their insurers would be settled
by binding arbitration.
Plaintiffs attorneys have been the strongest opponents of no-fault, and successfully have killed the issue in the past.
But they have begun to amass a war chest and a battle strategy for what they believe will be an expensive campaign.
"The 'underground war' has begun. The ground war has yet to start," said Adam Goodman, of the Robert Goodman Agency, a political consulting firm the Maryland Trial Lawyers Association hired to help defeat no-fault.
No-fault supporters, including many insurance companies and trade associations, and some consumer and business groups, acknowledge that their campaign in Maryland is only beginning. "We're not going away," said Robert Mann, the state director of Project New Start, a business and consumer group advocating an optional no-fault system, like the one heard before the House committee yesterday.
The issue was given some measure of vitality when the Governor's Commission on Insurance made a preliminary recommendation earlier this year supporting the concept of no-fault.
Gov. William Donald Schaefer has no position on the issue, according to one of his legislative aides, Bruce P. Martin. "The commission has not completed its deliberations," he said, "and has made no concrete recommendations to the governor on no-fault."