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Is Senate's auto insurance reform a breakthrough in push to lower rates in Michigan?

State Senate passes auto insurance reform

LANSING, Mich. – After years of talk, Tuesday could have finally brought a breakthrough in the push to lower Michigan's high auto insurance rates.

UPDATE: Michigan House passes auto insurance reform bill: What to know

For the first time, the state Senate passed comprehensive auto insurance reform. Two big questions remain:

  • What is actually in the bill?
  • Is it going to make it past the House and Gov. Gretchen Whitmer?

This is a lot of what Detroit Mayor Mike Duggan and business leaders have requested. For starters, it would bring an end to that lifetime medical benefit, which is called the PIP, or personal injury protection. It's the most expensive portion of the plan.

Michigan residents driving legally right now have an insurance plan with the mandated lifetime medical benefit, but what went through the Michigan Senate on Tuesday could change everything.

Here are some big takeaways:

  • Drivers would now have a choice of PIP levels, or none at all.
  • Hospitals would no longer be able to charge what they see fit for medical care of auto accident victims. They would be forced to follow the workers' compensation fee schedule.
  • It would require the Michigan Catastrophic Claims Fund to be transparent about how much money it has and would create an auto insurance task force to be run by Michigan State Police.

Also included in the bill is language that would prevent insurers from basing rates on gender and refusing service to some ZIP codes.

The bill made it out of the Senate with Republican and some Detroit Democrat votes. It will now head to the House.


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