RAPID Act: Potential Impact on Auto Insurance in Arizona

Arizona State Representative Nick Kupper has introduced the Reasonable And Prudent Interstate Driving Act (RAPID Act), aiming to allow drivers to determine their own safe speeds on specific interstate highway segments. This initiative seeks to establish a pilot program on a portion of Interstate 8. The proposed legislation could significantly impact auto insurance premiums and risk management strategies within the state.

Potential Implications for the Insurance Sector

Rick Murray, head of the National Safety Council's Arizona sector, presented data linking higher speed limits to increased vehicular accidents and fatalities. He cautions that such policy changes could drive up auto insurance costs, with the average full-coverage policy costing Arizona drivers $2,644 annually, currently below the national average. Insurance industry professionals are particularly concerned about the RAPID Act's impact on underwriting and claims processing should accident rates rise.

The RAPID Act proposes eliminating existing daytime speed limits on designated roads, initially on a trial basis. Representative Kupper cites evidence from Montana, where similar policies were briefly enacted, suggesting reduced traffic fatalities without posted limits. However, historical and regulatory compliance challenges persist, as past attempts to maintain limitless speed restrictions were invalidated by legal standards, necessitating speed limit reinstatement.

Industry and Regulatory Reactions

Industry experts are closely monitoring the RAPID Act's review by the Arizona House of Representatives' Transportation and Infrastructure Committee. This debate not only holds implications for state policy but could also influence broader traffic safety discussions. As Murray emphasized, "Whenever claims go up, insurance goes up," indicating potential adjustments in premium calculations if the bill increases accident frequency.