Reforming No-Fault Insurance Would Lower Costs, Reduce Uninsured Cars

Van Beek discusses reforms in Fox UP interview

Michigan drivers pay the highest auto insurance rates in the country on average and will soon be paying more to drive in the state, but lawmakers can bring down the cost by reforming the system.

Mackinac Center for Public Policy’s Director of Research Michael Van Beek spoke with TV 6 and Fox UP about changes that should be made to Michigan’s insurance mandates to lower costs to drivers as drivers brace for higher fuel taxes and registration fees in 2017.

One simple reform, I think, would be to look at the unlimited personal injury protection and get that in line with what's more common throughout the country, which is to have a limited personal injury protection.

Michigan’s requirement that every driver purchase unlimited Personal Injury Protection means there’s no limit to what medical facilities can charge individuals seeking treatment from auto collisions. TV 6 and Fox UP cited a study by AAA Michigan that found a neck MRI costs $483 when paid by Medicare but $3,258 when paid through insurance.

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"That's because hospitals know that they can charge more because auto insurance companies are required to pay an unlimited amount for medical benefits for people who are injured in automobile accidents," Van Beek told the station.

In addition to letting Michiganders keep more money in their pockets, reducing the cost of insurance would also lower the number of uninsured drivers in the state, as Van Beek explained in a recent Viewpoint on the topic.

View the full report at TV 6 and Fox UP here.

Read more about Michigan’s no-fault insurance and reforms here.

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