Rep. Thomas Albert and the Michigan House today approved a landmark plan to fix the state’s much-maligned car insurance system and reduce rates for all Michigan drivers.

Albert voted in favor of the plan to guarantee lower rates and give drivers more choice on personal injury protection coverage, stop price gouging on medical services for car accident victims, and combat fraudulent claims to help lower costs.

The changes are designed to end Michigan’s long-standing tenure as the state with the costliest car insurance rates in the nation.

“Even before I was elected to the state House, I heard the same message from west Michigan families – do something to lower the cost of car insurance. It’s too expensive and causing too many problems with family budgets,” said Albert, of Lowell. “I’m excited that we are finally taking a major step toward fixing our broken car insurance system with this vote today – while maintaining choice in coverage levels.”

Michigan’s costs are high largely because it’s the only state mandating unlimited lifetime health care coverage through car insurance. The House-approved plan allows those currently using the coverage to keep it, and those who want it in the future to continue buying it – while providing more affordable options.

The plan:

• Guarantees lower rates on the personal injury protection portion of policies. It would result in a 10-percent reduction within the PIP portion of bills for those buying unlimited coverage, a 30-percent drop for drivers choosing $500,000 in coverage, a 60-percent reduction for those purchasing $250,000 in coverage, and an 80-percent drop at the $50,000 coverage level.
• Allows seniors with retiree health coverage such as Medicare, and those with health insurance policies that cover car accident-related injuries, to opt out of PIP coverage.
• Establishes fee schedules to end the practice of charging far more to treat car accident victims than other patients.
• Cracks down on fraud and abuse by creating a fraud task force.
• Provides more financial oversight of and transparency within the Michigan Catastrophic Claims Association.
• Sets reasonable limits on compensation for attendant care contracts.
• Helps the state ensure insurance companies charge fair rates, while addressing attorney fee settlements and significantly reducing litigation.

The sweeping legislation now advances to the Senate for consideration.