House approves historic proposal after decades of failure

The Michigan House today approved a landmark plan to fix our state’s disastrous car insurance system and reduce rates for all Michigan drivers, state Rep. Beau LaFave announced.

LaFave voted in favor of the plan to offer drivers personal injury protection (PIP) coverage options, rein in medical costs, and fight fraud – features designed to end Michigan’s long-standing tenure as the state with the costliest car insurance rates in the nation.

“This historic reform has been over 45 years in the making, and I’m honored to deliver real rate savings to the people who deserve it the most – Michigan drivers,” LaFave, of Iron Mountain, said after the vote. “When you look at our neighbors in Wisconsin who pay less than half of what we do for car insurance, you’ve got yourself a $1,000 problem that affects every motorist. Many of our youth have left to escape nation-high car insurance premiums, and it has ripped families apart. Finally, they can come back home. I’m happy to deliver results to all Upper Peninsula families sick and tired of the exorbitant costs.”

LaFave has been a lead advocate for reforms his entire legislative career, and is also a member of the House Select Committee on Reducing Car Insurance Rates Committee – the special panel solely dedicated to crafting a long-lasting solution that cuts down drivers’ rates.

Michigan’s costs are high largely because it’s the only state mandating unlimited lifetime health care coverage through car insurance. House Bill 4397 allows people to continue to buy unlimited coverage if they wish– while also providing more affordable options.

The plan:

• Guarantees lower rates on the personal injury protection portion of policies. It would result in a 100-percent reduction for drivers that opt out of PIP coverage, an 80-percent drop at the $50,000 coverage level, a 60-percent reduction for those purchasing $250,000 in coverage, a 30-percent drop for drivers choosing $500,000 in coverage, and a 10-percent reduction for those buying unlimited coverage;
• Gives drivers a choice on car insurance policies;
• Stops price gouging on medical services for car accident victims; and
• Combats fraudulent claims to help lower costs

The sweeping legislation now advances to the Senate for consideration.

PHOTO INFORMATION: State Rep. Beau LaFave address the full House body on Thursday in favor a House plan to bring relief to Michigan drivers through lower car insurance rates.