A new report by the American Bar Association says no-fault auto insurance systems are not working as well as expected, often result in higher premiums and may conceivably lead to more accidents by allowing persons to collect damages without having to prove negligence on the part of another driver.
The report concluded that a federal no-fault statute is a bad idea at this time and called for new studies in the 24 states that have some form of no-fault.
The legal profession has generally resisted no-fault proposals, which would allow a motorist to collect for injuries without having to go to court.
Under the federal no-fault bill before the Senate and House Commerce committees, an injured person to $100,000 medical expenses. $12,000 compensation for lost salary or $20 a day for a year for household help during recuperation.
He would collect from his own insurance firm. He could sue only for economic losses in excess of those under his no-fault policy, or if there were death, permanent injury or disfigurement.
Proponents say it would save lawyer fees and cost less per dollar of benefits. The federal legislation wouldn't change existing insurance policies on property and vehicle demage.
The ABA study quoted Rep. Bob Eckhardt (D-Tex.) as saying that in East Boston, Mass., a no-fault state, a total auto insurance package including bodily injury, property and vehicle damage cost $542.24 in 1970 but $1,219 in 1976 after six years of no-fault.
It also said that in Florida, the cost of bodily in-injury insurance had gone up 84 percent since 1971. It said experience in other no-fault states had been little better.
The ABA study said Florida crashes had gone up 29 percent since no-fault, and that in Massachusetts certain types of accidents had increased, which may "reveal a greater propensity for individuals to become involved in such accidents as a result of no-fault." It said it might be a good idea to encourage states to try systems in which a driver buys no-fault to cover injuries to himself, but can still sue the other party for amounts in excess of that coverage.
In a rebuttal, the Committee for Consumers No-Fault called the ABA Florida and Massachusetts premium figures misleading. It said the East Boston rate increases were due entirely to increases in premiums for property and vehicle damages.
Personal injury rates actually went down by nearly one-third under no-fault. In Florida, it said. Personal injury premium increases were partly the result of fraud and changes in negligence rules, but, in any event, premiums for trucks, which aren't under no-fault, rose by 99.8 percent while cars under no-fault rose less sharply.
S. Lynn Sutcliffe, president of the committee, also said the ABA report was "absurd" to suggest that the availability of no-fault insurance causes a person "to ignore the fear of injury to oneself." He said accident rates are determined by other factors, such as speed, road and car conditions.