Historic car insurance reform supported by Rep. Kathy Crawford was signed into state law today, lowering costs for all Michigan drivers.
The reforms – approved by Crawford and the Legislature – give drivers more choice on personal injury protection coverage, combat fraudulent claims and reduces high costs of medical services for car accident victims. Many Michigan families will save hundreds of dollars or more each year.
Michigan has had the most expensive car insurance in the nation mostly because it’s the only state mandating unlimited lifetime health care coverage through car insurance, with no corresponding cap on what medical providers may charge accident victims. The revised law will provide more affordable options for motorists while allowing those who currently use the unlimited coverage to keep it, and those who want it in the future to continue buying it.
“Oakland County drivers will now have affordable options to purchase car insurance that works for them and their families,” said Crawford, of Novi. “This historic reform will deliver guaranteed savings for drivers all across the state who need it the most.”
Beginning in July 2020, many drivers will be able to opt out of personal injury protection altogether, including seniors with retiree health coverage such as Medicare and those with health insurance policies that cover car accident-related injuries. Others will be able to continue with unlimited coverage or choose PIP limits of $250,000 or $500,000. A $50,000 option will be available for drivers on Medicaid.
Other reforms include:
· A fee schedule to rein in runaway costs that result from medical care providers charging far more to treat car accident victims than other patients.
· An anti-fraud unit will help crack down on those abusing the system, helping to further lower car insurance rates.
· Non-driving factors, such as ZIP codes, home ownership and educational level, can’t be used to determine rates.