Michigan No-Fault Auto Insurance Reform

How Michigan Auto Insurance Has Changed

Historically, Michigan residents paid some of the highest auto insurance rates in the country. Why was that?

Reason #1

Michigan had the highest auto insurance coverage requirement sin the United States — most notably Personal Injury Protection (PIP) insurance with unlimited lifetime medical coverage for car accident injuries. Michigan’s insurance requirements guaranteed many health and recovery benefits to people injured in car accidents, including reimbursement for lost wages, in-home care and medical treatments.

Reason #2

These unlimited benefits made Michigan’s car insurance coverage arguably the best in the country for those injured in car crashes. But there were expensive downsides: The system attracted costly medical claims, fraud and legal battles among insurers, medical providers and policy holders over what was covered and how much it would cost.

Reason #3

Insurance companies elevated rates for all drivers to account for those expensive losses. The problem was compounded when drivers dropped insurance coverage because they couldn’t afford it.

Michigan law makers and drivers spent decades debating how to reduce the cost of auto insurance in the state.

Now, thanks to Michigan no-fault auto insurance reform, change is here.