Shiawassee Times

State Rep. Ben Frederick (R-Owosso) recently announced that Michigan drivers will experience significant savings under the first wave of rates approved under the state's new no-fault car insurance law.

“As Michigan moves closer to the launch date of our reformed car insurance system, the first approved rates indicate Shiawassee and Saginaw County families and residents across the state will see savings that surpass the mandated rate reductions outlined under the new law,” Frederick said in a press release.

Six rates have been filed and approved by the Michigan Department of Insurance and Financial Services (DIFS). Data shows that the new approved rates for personal injury protection (PIP) afford greater savings than the mandatory threshold outlined under the new law set to take effect Wednesday, July 1. 

According to DIFS, under the new policy, Michigan drivers who opt out of the PIP coverage will not be responsible for that portion of the insurance premium and will have no PIP medical coverage under their policy. Once the new law is enacted, insurance companies are subject to a 45% or greater reduction per vehicle for the $50,000 PIP option; a 35% or greater reduction for the $250,000 PIP option; a 20% or greater reduction for the $500,000 PIP option, and a 10% or greater reduction for the unlimited PIP option. 

Drivers' premiums will continue to be based on coverage they choose and factors related to their personal situation, but for the first time, drivers will be able to select a personal injury protection coverage level appropriate for their budget and needs. PIP medical coverage provides for medical expenses if policyholders are in an accident. 

“July 1 is approaching quickly, and it’s refreshing to see progress made by the department – even during the middle of the COVID-19 outbreak – to ensure insurance providers are effectively transitioning into a new structure that provides more affordable products for every Michigan driver and their families,” Frederick said in the release. “While these are the first rates to be approved in preparation for the upcoming rollout of the new no-fault law, I expect several more rate approvals to come in the near future that mirror these substantial savings.”

More information about Michigan's new auto insurance policy laws can be found here.