What’s Wrong With Auto Insurance in Michigan

(and What We Can Do About It)

The Issue at Hand

It’s no secret that Michigan’s no-fault auto insurance system has problems. Michigan drivers pay some of the highest insurance premiums in the country.

Premiums are so costly, in fact, that an estimated one in five vehicles in Michigan is driven by an uninsured driver.

No other state in the nation requires drivers to purchase coverage that provides unlimited benefits — this despite the fact that only a tiny fraction of drivers will ever cash in on those benefits.

Even the primary purpose of using a no-fault system — reducing lawsuits and court costs — no longer holds in Michigan: Auto-related lawsuits are on the rise.

Clearly, reform is needed.

A Viable Solution

The Michigan Legislature appears ready to tackle this issue and pass reforms that would work to drive down premiums in Michigan. House Bill 5013 would institute several changes that would be beneficial for Michigan drivers. It would:

  • Give drivers a choice about what level of coverage would fit them best
  • Require insurance companies to reduce their premiums for the next five years
  • Limit the ability of lawyers to win large attorney fees in automobile lawsuits
  • Allow Medicare-eligible drivers to opt out of paying for expensive auto insurance coverage
  • Require medical providers to charge no more than the average cost for services and procedures

House Bill 5013 doesn’t create a perfect auto insurance market, but it makes significant steps in the right direction to the benefit of Michigan drivers. It should be supported by anyone interested in making car insurance more affordable in Michigan.