The Michigan House Insurance Committee is expected to vote on a bill May 2 to reform the state's no-fault auto insurance system.
HB 4612 is designed to address attorneys' fees, cap personal injury protection (PIP) and create a fraud bureau. It also puts an end to the requirement that consumers buy unlimited lifetime medical coverage.
Michigan is the only state that does this for auto accident injuries, according to the Property Casualty Insurers Association of America, who calls the legislation an "important step toward addressing skyrocketing costs."
The trade association, who says Michigan drivers pay 20 percent to 30 percent more than neighboring states, supports the measure.
"This one-size-fits-all system is expensive, has few cost controls, and does not provide incentives for thrift," says Jeff Junkas, regional manager for PCI, in a statement.
Even with the reform in place Michigan's mandatory coverage for accident victims would be the best in the nation—$1 million.
The National Association of Mutual Insurance Companies calls HB 4612 a "step in the right direction toward rescuing Michigan's failing no-fault system."
Erin Collins, state affairs manager, says the current system gives consumers no choice in products and forces them to buy the highest medical benefit in the country.
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