LANSING, Mich. — Sen. Jim Stamas on Friday voted to send the governor a bipartisan agreement to guarantee lower auto insurance rates for Michigan drivers.
“I have long supported reforms to reduce Michigan’s highest-in-the-nation car insurance rates, which are having a tremendous impact on family budgets throughout our state,” said Stamas, R-Midland. “This historic and bipartisan reform guarantees lower car insurance rates for Michigan drivers while ensuring that accident victims still receive the medical care they need.
“Senate Bill 1 cracks down on fraud and lawsuit abuse, includes cost containments, gives drivers the ability to choose the auto insurance coverage that best meets their needs and budget — for the first time in almost five decades — and cuts the announced $220 annual Michigan Catastrophic Claims Association fee by $180 per vehicle for all options other than unlimited coverage.”
According to an October 2018 report, Michigan drivers pay the highest auto insurance rates in the country — 83% higher than the national average.
SB 1 would require auto insurers to offer Michigan drivers five new personal injury protection (PIP) coverage options with guaranteed PIP rate reductions:
• A PIP opt-out option for drivers with qualified health coverage, such as employer health insurance or Medicare — 100% PIP reduction.
• A $50,000 coverage option for Medicaid-eligible drivers — at least 45% PIP reduction.
• A $250,000 coverage option — minimum 35% PIP reduction.
• A $500,000 coverage option — minimum 20% PIP reduction.
• An unlimited option like what is currently required — at least 10% PIP reduction.
SB 1 would also ban the use of several nondriving factors in setting insurance rates and reduce fraud and conflicts of interest in the auto insurance system.
People already receiving care through the Michigan Catastrophic Claims Association will continue to get lifetime care under their current unlimited benefit policy as promised.
“We made it a top priority to enact a real solution that reduces the burdensome cost of car insurance facing Michigan families,” Stamas said. “With this agreement between the Legislature and the governor, we will deliver much-needed relief to drivers in our state.”