Letter: No-fault reform will result in savings
When it comes to auto insurance in Michigan, all sides agree on one thing: It costs too much. Michigan drivers pay among the highest premiums in the country, driven by escalating medical costs that have put auto insurance out of reach for too many drivers. We enjoy generous benefits in Michigan, but without effective reform, our no-fault system will ultimately fail.
Legislation to address this issue has been passed by the State Senate in the last week and will soon be considered on the floor of the Michigan House. The bills include several provisions that we believe will succeed in helping contain costs without reducing benefits. Most importantly, the legislators are attempting to reduce the disparity in costs paid for medical procedures between auto insurers and everyone else. Under the current system, Michigan residents pay up to three times more for medical services when their auto insurance pays the bill instead of their health insurance. These costs are eventually passed on to drivers in the form of higher auto insurance premiums. The legislation also includes provisions for identifying and eliminating fraud and setting guidelines for in-home care reimbursement.
So what will happen to the money that is saved? AAA will pass the savings on to our insurance customers in the form of lower premiums. If it costs AAA less, it will cost you less. Period.
Our legislators have a historic opportunity to make the best auto insurance in the country more affordable for more drivers. We applaud Lansing for tackling this important issue, and we urge the Legislature to pass this bill and the governor to sign it into law. This is effective reform that will help make auto insurance more affordable. AAA has a long heritage of advocating for Michigan drivers, and we will continue to play our part in making affordable auto insurance available to all.
Steve Wagner, president, AAA Michigan