By June 20, 2007 0 Comments Read More →

Car Insurance rates and Colorado tort law

Reader question:

I heard that something would change with car insurance rates because of new tort law in Colorado. What’s going on, then? Is it good or bad?


For consumers, it’s looking pretty good.

Colorado’s new insurance law is reaching four years old and it looks like the customers are the ones coming out on top, this time. Since the change in law, in 2003, insurance rates has dropped as much as 30% for citizens of Colorado who patronize the larger insurance companies. On Monday, the ninth rate decrease was announced by the state, a whopping 7.2%, which most states don’t see in a year. That adds to the rest of the decreases to make up a total of 42% in decreases in the four year period.

Formerly, Colorado had a no-fault system, which meant that car insurance companies paid the medical bills in a crash without regards as to who was at fault. The new law, called a tort law, makes the driver who was at fault responsible for such bills.

Before the law changed, injury coverage alone had gone up 80%, and premiums and general about 30%, in a short period of 18 months. It’s amazing to see that these rises have folded back on themselves with the change in law.

With all those double-digit increases, something had to be done. After the change in the system, Colorado’s insurance rates have stabilized to fit with national rates, which in the same time period had changed less than 1%.


Fashun Guadarrama.

Posted in: Auto Insurance

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