LANSING, Mich. — Sen. Jim Stamas on Tuesday voted to support Senate legislation to reduce auto insurance rates in Michigan by providing drivers more coverage choices, cracking down on fraud and lawsuit abuse, and reducing inflated medical costs.
“One of the top issues I hear about from residents is the tremendous impact that our state’s highest-in-the-nation car insurance rates are having on family budgets and our economy,” said Stamas, R-Midland. “I have long supported reforms to make auto insurance more affordable, and I am proud to support this comprehensive plan to lower car insurance rates for all Michigan drivers while ensuring that accident victims still receive the medical care they need.”
According to an October 2018 report, Michigan drivers pay the highest auto insurance rates in the country — 83% higher than the national average. A recent University of Michigan study also said that auto insurance rates are unaffordable in 97% of the state’s ZIP codes.
Senate Bill 1 would require auto insurers to offer Michigan drivers at least three new personal injury protection (PIP) coverage options, including the ability of drivers with qualified medical coverage — such as health insurance, Medicare or Medicaid — to opt out of PIP coverage since they already have medical coverage for injuries.
“This reform would give drivers the ability to choose the auto insurance coverage that best meets their needs and budget — for the first time in over 45 years,” Stamas said. “With this increased flexibility and depending on the choices made, Michigan drivers could see modest savings or save as much as 90% on their car insurance.”
SB 1 would also reduce out-of-control medical costs that are passed on to drivers via higher rates, cut fraud and conflicts of interest in the auto insurance system, and reduce the Michigan Catastrophic Claims Association (MCCA) fee by approximately $180 per vehicle.
People already receiving care through the MCCA will continue to get lifetime care under their current unlimited benefit policy as promised.
“This is a huge step to finally providing much-needed relief to Michigan drivers,” Stamas said. “The bipartisan Senate plan offers a real solution to the burdensome car insurance costs facing Michigan families, and I encourage our House colleagues and the governor to make it a reality.”