Posted On: December 26, 2006 by Christopher T. Hurley

Illinois court allows step-down auto insurance provisions

Declaring that a competitor's insurance policies violate Illinois public policy, State Farm Mutual Automobile Insurance Co. is crusading against ''step-down'' provisions.
Step-downs contained in auto policies peddled by Illinois Farmers Insurance Co. reduce — to the statutory minimum — the amount of liability insurance for certain ''permissive'' drivers.

Auto policies usually provide the same level of financial protection for named insureds and permissive drivers. So, when an owner has a policy providing $250,000 in liability protection, a friend or neighbor who is driving the vehicle with the owner's permission would also have $250,000 in coverage.

Spotting an opportunity to reduce its financial exposure in a way that most policyholders probably do not notice, Illinois Farmers uses step-down provisions.

When an accident is allegedly caused by a permissive driver who is not a relative of the named insured, or a resident of the name insured's household, Illinois Farmers policies provide only the minimum amount of liability protection required by the Illinois Safety and Family Financial Responsibility Law.

This means that even if an Illinois Farmers policy provides $100,000 in liability protection for a named insured, a friend of the owner would have coverage of only $20,000 per person, $40,000 per occurrence and $15,000 for property damage.

Bookmark: Bookmark Illinois%20court%20allows%20step-down%20auto%20insurance%20provisions at del.icio.us Digg Illinois%20court%20allows%20step-down%20auto%20insurance%20provisions at Digg.com Bookmark Illinois%20court%20allows%20step-down%20auto%20insurance%20provisions at Spurl.net Bookmark Illinois%20court%20allows%20step-down%20auto%20insurance%20provisions at Simpy.com Bookmark Illinois%20court%20allows%20step-down%20auto%20insurance%20provisions at NewsVine Blink this Illinois%20court%20allows%20step-down%20auto%20insurance%20provisions at blinklist.com Bookmark Illinois%20court%20allows%20step-down%20auto%20insurance%20provisions at Furl.net Bookmark Illinois%20court%20allows%20step-down%20auto%20insurance%20provisions at reddit.com Fark Illinois%20court%20allows%20step-down%20auto%20insurance%20provisions at Fark.com Bookmark Illinois%20court%20allows%20step-down%20auto%20insurance%20provisions at Yahoo! MyWeb