Sen. Lauwers supports reform to reduce auto insurance rates

Sen. Lauwers supports reform to reduce auto insurance rates

LANSING, Mich. — Sen. Dan Lauwers on Tuesday supported legislation to reduce auto insurance rates in Michigan by providing drivers more coverage choices, cracking down on fraud and lawsuit abuse, and reducing inflated medical costs.

“A constant theme as I travel the district has been, ‘fix the high cost of auto insurance — now’; in fact, in the past seven years, I haven’t been in a public setting where this issue hasn’t come up,” said Lauwers, R-Brockway Township. “The bill passed today finally addresses this problem and provides long-overdue relief.”

According to an October 2018 report, Michigan drivers pay the highest auto insurance rates in the country — 83% higher than the national average. A recent University of Michigan study also said that auto insurance rates are unaffordable in 97% of the state’s ZIP codes.

Senate Bill 1 would require auto insurers to offer Michigan drivers at least three new personal injury protection (PIP) coverage options, including the ability of drivers with qualified medical coverage — such as health insurance, Medicare or Medicaid — to opt out of PIP coverage since they already have medical coverage for injuries.

The legislation would also reduce out-of-control medical costs that are passed on to drivers via higher rates, cut fraud and conflicts of interest in the auto insurance system, and reduce the announced $220 annual Michigan Catastrophic Claims Association fee by 80%.

“This provision alone means an immediate savings of $180 per vehicle,” Lauwers said. “On my farm that means a $1,260 reduction.”

SB 1 now heads to the Michigan House for further consideration.

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