MacGregor: A historic plan to lower auto insurance costs

LANSING, Mich. — Senate Majority Floor Leader Peter MacGregor applauded a bipartisan plan approved on Friday that will significantly lower auto insurance costs for drivers throughout west Michigan.

“Today is a historic day in the state of Michigan,” said MacGregor, R-Rockford. “After decades of failed attempts to reform our broken auto insurance system, the two Republican leaders and a Democrat governor came together to find a real solution to a decades-old problem. It is a monumental achievement and a big win, not only for west Michigan families, but for all Michigan residents.”

The final reform, approved Friday by the Senate and House, and which the governor is expected to sign soon, will be phased in over time once it becomes law.

Key components of the plan include:

  • Requiring auto insurers to provide customers with a range of personal injury protection (PIP) options so they are free to choose the level that best suits their personal needs and will reduce their rates by 10% to 100% based on those choices;
  • Guaranteed, automatic rollback of the annual Michigan Catastrophic Claims Association fee by 80% for all options other than unlimited coverage;
  • Strengthening the insurance fraud division within the state Department of Insurance and Financial Services to empower law enforcement to crack down on auto insurance fraud;
  • Ending excessive health care costs related to auto insurance claims by implementing a fee schedule to cap the amount providers can charge insurers; and
  • Attorney and lawsuit reforms.

Michigan drivers currently pay the highest auto insurance rates in the country — 83% higher than the national average according to an October 2018 report. A University of Michigan study also said that auto insurance rates are unaffordable in 97% of the state’s ZIP codes.

“This is a great plan that will guarantee lower auto insurance rates for all drivers for years to come,” MacGregor said. “These are real savings that will help ensure more of our residents’ hard-earned money can be spent on their own budget priorities.”

Senate Bill 1 awaits the governor’s signature.

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