LANSING, Mich. (WLUC) - Following weeks of bipartisan negotiations, Michigan’s House and Senate have approved a bill that would reduce the country's highest auto insurance premiums. The votes came after a deal was announced between G.O.P. legislative leaders and democratic Governor Gretchen Whitmer.
The final bill includes several provisions put forward by House Democrats including the elimination of non-driving rate-setting factors, guaranteed rate reductions and increased consumer protections. The Senate also approved the legislation. It would offer choice among personal injury protection levels.
Michigan is the only state to require that drivers buy unlimited coverage for crash injuries.
"So we had to negotiate a lot of ways to get the governor's support. I voted for a bill that would have cut insurance rates in 90 days, unfortunately the governor wouldn’t take that deal. And it's going to take 14 months, but July 1 of 2020 every driver that has health insurance is going to be able to opt out of PIP - personal injury protection and not pay the MCCA fee anymore,” said Michigan's 108th District House Representative Beau LaFave (R-Iron Mountain).
Options will be available to buy personal injury protection at various levels.
Rep. LaFave says the average family will be able to save $1,000 per year on their car insurance and hopes that this money will be spent in local U.P. stores.
Gov. Whitmer had this to say:
“Today’s vote is truly historic. We've accomplished more in the last five months than in the last five years. This vote demonstrates that when both parties work together and build bridges, we can solve problems and make life better for the people of Michigan.
“This plan will help drivers from Detroit all the way to the U.P. It guarantees lower auto insurance rates for eight years, protects people’s choice to pick their own insurance and coverage options while preserving the safety net, and bans insurance companies from using discriminatory non-driving factors when setting rates.
“We still have more important work ahead of us to build a stronger Michigan for everyone. Now we must seize on this momentum to pass a strong, bipartisan budget that raises the revenue we need to improve education and skills training, clean up our drinking water, and fix the damn roads. Let’s get to work, and let’s get it done.”
In response, State Rep. Sara Cambensy (D-Marquette) said:
“After another week of negotiations to reform Michigan’s Auto No-Fault laws, we made further progress to save constituents money by passing a monumental change in our car insurance laws. Most important to me, we gave the Attorney General and the Department of Insurance and Financial Services back the authority to go after the estimated $800 million in fraudulent no-fault claims each year. This exorbitant number shows just how out-of-control fraudulent car insurance claims in Michigan have become, and why we had to send a clear message today that that fraud will not be tolerated any longer.
“Every major interest group involved in no-fault insurance took a hit with this bill. Today’s vote was a vote that the people of Michigan adamantly demanded and rightfully deserved. This bill makes big changes and is not perfect. While the work is not done and there is more we can do, this is a huge step forward for Michigan families and our state.”
State Rep. Greg Markkanen (R-Hancock), also commented on the major step for Michigan:
“The high cost of Michigan’s car insurance is one of the most common complaints I hear from people in our community. We’ve listened to their concerns and produced a solution that will make driving more affordable for families and seniors in the Upper Peninsula and all across Michigan.”
State Senator Ed McBroom (R-Vulcan) of Michigan’s 38th Senate District said:
“The extreme high cost of auto insurance is the number one issue I heard about from constituents. All of us are looking forward to the relief our families, businesses and communities will have from these significant changes.
“Drivers in the Upper Peninsula and throughout Michigan pay the most expensive car insurance rates in the country — the system is broken, and today we acted to fix it. I am glad that we were able to come together to approve this long-overdue reform to help make driving in our state more affordable for everyone.”
Michigan Attorney General Dana Nessel issued the following statement:
“After reviewing today’s legislation that overhauls Michigan’s auto insurance system, I feel confident that the Attorney General’s office will have the statutory tools we need to vigorously and thoroughly investigate and prosecute auto insurance fraud in Michigan.
“Once this legislation is signed into law, our office will continue to do what we do best: investigate and prosecute crime. To that effect, I look forward to expanding our cooperative relationship with the Department of Insurance and Financial Services so our collaborative efforts can have the greatest impact on protecting Michigan citizens. There are few places where this is more important than in the insurance industry where our team is laser focused on protecting drivers from price gouging and other shameful tactics that have been used in the past.”