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Rep. Paquette: Car insurance reforms signed into law, ending highest-in-the-nation rates
RELEASE|May 30, 2019
Contact: Brad Paquette

Car insurance reform supported by Rep. Brad Paquette was signed into state law today, lowering costs for all Michigan drivers.

The reforms – approved by Paquette and the Legislature – give drivers more choice on personal injury protection coverage, combat fraudulent claims and stop price gouging on 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. The revised law will provide more affordable options while allowing those who currently use the unlimited coverage to keep it, and those who want it in the future to continue buying it.

“Soon, Michigan drivers will feel the long-overdue rate relief they deserve,” said Paquette, of Niles. “No longer will we lose friends and neighbors who move to Indiana for lower auto insurance rates. I’m proud to have placed my support behind this historic reform and pleased to see this plan become law today.”

Starting in July 2020, some 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.

A fee schedule will be established for medical providers, reining in runaway costs that result from medical care providers charging far more to treat car accident victims than other patients.

Non-driving factors such as zip codes, home ownership and educational level can’t be used to determine rates. Residents in Southwest Michigan will no longer have to pay higher rates to subsidize drivers in other areas.

An anti-fraud unit will help crack down on those abusing the system, which should help further lower car insurance rates.

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