Legislator: High cost of car insurance was prioritized and we delivered

State Rep. Michele Hoitenga, of Manton, served on the House Republican Action Plan Committee prior to the 2019-20 legislative term to iron out the best way forward for Michigan residents and their families.

The committee took into account priorities of residents throughout the state and the astronomical cost of car insurance – the highest premium rates in the country, on average – was a paramount concern.

During the first six months of the 100th Michigan Legislature, Hoitenga has voted to support a plan to fix the state’s broken no-fault car insurance system. The proposal today was signed by the governor and will soon bring hundreds of dollars in car insurance savings to Northern Michigan drivers – offering personal injury coverage options, combating fraud and abuse, and addressing medical costs.

“One of the most amazing things about this was the opinion that something like this couldn’t be done – that it was too big of a lift,” Hoitenga said. “Historically, that’s proved to be the case and the status quo has remained. But this Legislature prioritized this issue. I listened to people every day who needed rate relief and were making difficult financial choices due to the high cost of their car insurance. I want them to keep more of their hard-earned money instead of opening a car insurance bill and wondering how they’re going to afford it. With this plan, they’re going to have some choices that can save them some money and that will make a huge difference.”

Mandated unlimited lifetime health care coverage through car insurance plans is a primary reason why costs are so high in Michigan. The new law allows those currently using the coverage to keep it, and those who want it in the future to continue buying it – all while providing more affordable options.

For the first time in Michigan’s history, drivers will be able to have a choice in their level of PIP coverage. Beginning in 2020, many 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.