LANSING, Mich. — A comprehensive bipartisan plan to lower auto insurance rates in the state was finalized on Friday, said Sen. Ed McBroom, who voted in support of the plan.

“Drivers in the Upper Peninsula and throughout Michigan pay the most expensive car insurance rates in the country — the system is broken, and today we acted to fix it,” said McBroom, R-Vulcan. “I am glad that we were able to come together to approve this long-overdue reform to help make driving in our state more affordable for everyone.”

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

Key components of the plan include:

• Requiring auto insurers to provide customers with a range of personal injury protection (PIP) options, including the ability to opt out of PIP coverage entirely if an individual has other qualified health coverage, including Medicare, a $50,000 policy for Medicaid enrollees, a $250,000 policy, a $500,000 policy, and an unlimited medical benefit policy;
• Reducing the annual per-vehicle Michigan Catastrophic Claims Association fee by 80% for all above options other than unlimited;
• Strengthening the insurance fraud division within the state Department of Insurance and Financial Services to empower law enforcement to crack down on auto insurance fraud;
• Ending excessive health care costs related to auto insurance claims by implementing a fee schedule to cap the amount providers can charge for care offered; and
• Eliminating or regulating many nondriving rating factors, such as sex or marital status, to ensure a level playing field.

“The extreme high cost of auto insurance is the number one issue I heard about from constituents,” McBroom said. “All of us are looking forward to the relief our families, businesses and communities will have from these significant changes.”

Senate Bill 1 heads to the governor for her signature.

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