Senate reforms improve auto insurance

LANSING, Mich. — State Sen. Peter MacGregor, R-Rockford, supported legislation approved on Thursday to reform auto no-fault insurance.

“Michigan’s drivers continue to pay some of the highest auto insurance rates in the country, in part because of our state’s auto no-fault insurance system,” Sen. MacGregor said. “Many attempts have been made over the years to reform this system, and I have been supportive of measures that would reduce costs for consumers.”

“The sensible reforms we approved today will reduce fraud and better protect insurance customers. I am hopeful these bills will lead to lasting, positive change and potentially lower rates.”

Senate Bill 1014 would create the Michigan Automobile Insurance Fraud Authority within the attorney general’s office to help investigate and reduce auto insurance fraud. The Insurance Institute of Michigan indicates auto insurance fraud in Michigan is estimated at $400 million per year.

Additionally, in Michigan, when drivers turn age 65 and go on Medicare, their auto insurance rates go up because Medicare does not coordinate with Michigan auto insurance. Michigan’s auto insurance law includes unlimited coverage for catastrophic injuries with no cap.

Under Senate Bill 787, seniors age 65 and older could have a choice to remain in the unlimited coverage system or opt out and request a cap on their auto insurance. They would also only pay a fraction of what they currently are paying into the catastrophic fund. This would bring Michigan in line with all other states and provide a more affordable option for this vulnerable population.

The bills now advance to the House of Representatives for consideration.