SD Senate fails to override veto on insurance bill

By CHET BROKAW

PIERRE, S.D.

Gov. Mike Rounds has succeeded in blocking a bill that sought to change South Dakota's insurance law to give some injured people a better chance of receiving full compensation for their losses.

The Senate fell three votes short of the two-thirds majority of 24 needed to override the governor's veto. The vote to override failed 21-13.

The bill dealt with situations in which people are injured as a result of someone else's fault. An injured person's own insurance company typically pays the medical bills until compensation is received from the person at fault. South Dakota law now allows the insurance company to be first in line to get money from that compensation to recover its expenses on those medical bills.

The measure would have required that injured people be fully compensated for all other losses, such as loss of income or property damage, before their own insurance companies could receive any of the money paid by the person at fault.

In his veto message, the governor said he agrees that the current system is unfair to some injured people but believes the bill goes too far in limiting the interests of insurance companies.

Rounds also suggested that the State Bar come up a compromise for consideration in next year's legislative session.

The bill's main sponsor, Sen. Nancy Turbak Berry, D-Watertown, said most people do not learn about the law until they are injured and a settlement does not provide enough money to cover all damages.

"If there's not enough money to go around, your insurance company gets paid back first," Turbak Berry said. "Then you're the one who loses out."

Turbak Berry said insurance rates have not increased in the other states that have passed similar bills.

In his veto message, Rounds said he believes damages paid before an insurance company can recover anything should be limited to actual past and future expenses. Disputes will arise if injured people can recover all damages, including those for pain and suffering and loss of enjoyment of life, he said.

Turbak Berry said those other damages, which cannot easily be assigned a price tag, are often the most serious damages. For example, people need to be compensated when accidents cause them to lose eyesight or the ability to walk, she said.

Senate Republican Leader Dave Knudson of Sioux Falls urged the Senate to agree with the governor's veto. Insurance companies have made it clear that premiums would rise if such a bill passed, he said.

Turbak Berry said the bill should be passed to help all South Dakotans who wind up injured through no fault of their own.

"We're not here to do the insurance industry's work," Turbak Berry said. "It's the people's work."