LANSING, MI (WTVB) – After months of discussion, the Michigan Senate Tuesday passed legislation to overhaul Michigan’s no-fault auto insurance policies. The move is the latest attempt to change existing laws to deal with the state’s high auto insurance rates.
Senators voted 24-14 to approve the main auto no-fault bill. The plan would allow drivers to choose the level of coverage that fits their needs and help lower rates by deflating medical costs and reducing fraud.
As passed, the Senate plan would require insurers to provide at least three levels of personal injury protection, or PIP, coverage: $250,000, $50,000 with an additional $200,000 rider for emergency room care and no personal injury protection coverage if the driver’s health insurance covers auto-related accidents.
The legislation would also create an auto insurance fraud authority within the Michigan State Police to monitor and prosecute potential abuse in the system, and base fees charged by hospitals and doctors treating auto-related accidents on the state’s workers’ compensation fee schedule.
The Senate plan would also wind down the Michigan Catastrophic Claims Association. Existing MCCA beneficiaries would continue to have coverage, but no one new would be added.
Proposed amendments from Democrats to mandate a 50 percent rate reduction and tie-barring the bill to legislation to prohibit insurance companies from using non-driving factors when determining rates failed on the floor.
The legislation now heads to the state House of Representatives.
