{"id":369,"date":"2023-09-14T18:50:13","date_gmt":"2023-09-14T18:50:13","guid":{"rendered":"https:\/\/diymakerhub.com\/?p=369"},"modified":"2024-05-31T21:07:09","modified_gmt":"2024-05-31T21:07:09","slug":"michigan-drivers-benefit-from-no-fault-reforms-rulings-constrain-gains","status":"publish","type":"post","link":"https:\/\/diymakerhub.com\/index.php\/2023\/09\/14\/michigan-drivers-benefit-from-no-fault-reforms-rulings-constrain-gains\/","title":{"rendered":"Michigan Drivers Benefit From No-Fault Reforms; Rulings Constrain Gains"},"content":{"rendered":"
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By Max Dorfman, Research Writer, Triple-I<\/em><\/strong><\/p>\n

The success of Michigan\u2019s no-fault insurance reforms<\/a> at reining in claims and contributing to premium reductions for many drivers has been crimped by adverse court decisions in cases contesting the reforms and other factors, according to new research by two Triple-I non-resident scholars.\u00a0<\/p>\n

Michigan can be viewed as \u201can experiment on both the promises and pitfalls of a grand vision for no-fault auto insurance,\u201d say the authors, Patricia Born<\/a>, Ph.D. of Florida State University and\u00a0Robert Klein<\/a>, Ph.D. of Temple University. \u00a0The policy brief,\u00a0No-Fault Auto Insurance Reform in Michigan: An Initial Assessment Revised<\/em><\/a>, <\/em>updates prior research<\/a> by the scholars. It evaluates the reforms and finds that \u2013 in addition to reduced claims and beneficial effects on many drivers\u2019 premiums \u2014 \u201cit also appears that the number of uninsured drivers has fallen significantly.\u201d<\/p>\n

Michigan\u2019s high auto insurance premiums contributed to a large percentage of uninsured drivers. In fact, Michigan was estimated to have the second-highest percentage of uninsured drivers among the states in 2019, at nearly 26 percent.<\/p>\n

\u201cThis motivated the state\u2019s Governor and Legislature to significantly reform its no-fault law and revise its regulation of auto insurance,\u201d the report says. \u201cThe reforms were enacted in 2019 and were phased in from 2019 through 2021. While these reforms and regulatory changes are relatively nascent, there is considerable interest in knowing their effects, including the consequences of eliminating unlimited medical benefits, instituting medical cost controls, and tightening auto insurance rate regulation.\u201d<\/p>\n

PIP costs in the state had previously caused skyrocketing premiums due to the high medical costs associated with this coverage. The researchers\u2019 data demonstrates that PIP claims costs dropped significantly because of these reforms.<\/p>\n

Additionally, Michigan\u2019s verbal threshold for liability claims appears to have reduced auto insurance costs and premiums in Michigan relative to other states. However, these savings were engulfed by its high PIP costs prior to the reforms. With PIP costs decreasing, the overall cost of liability coverage has also declined.<\/p>\n

Now, the number of uninsured drivers has also fallen as auto insurance has become more affordable due to the reforms. Overall, Michigan\u2019s average auto insurance premium for all coverages dropped from $2,611 in 2019 to $2,112 in 2021 \u2013 an 18.3 percent decrease. From 2019 to the first quarter of 2023, the average liability premium declined from $825 to $629 \u2013 a 23.8 percent decrease. The average loss cost for PIP in Michigan fell almost 40 percent, from $465 in 2019 to $280 in 2023.<\/p>\n

Despite these benefits, the paper says, \u201cThere are stakeholders who question whether the reforms have created a better system and are seeking to reverse or modify some of them.\u201d<\/p>\n

According to the study, some drivers expected greater premium savings than they have received. \u00a0Other parties who benefited from the old system (for example, medical providers and trial attorneys) \u201care seeking to reverse or temper at least some of the reforms that were enacted,\u201d the paper says.<\/p>\n

PIP claims costs have begun to rise within the last year due to recent adverse court rulings, as well as other factors, such as more frequent auto accidents.<\/p>\n

Learn More:<\/em><\/strong><\/p>\n

Michigan No-Fault Reform Yields Fewer Claims, Lower Premiums<\/a><\/p>\n

Despite Fewer Claims, Personal Auto Insurance Payouts Increase<\/a><\/p><\/p>\n","protected":false},"excerpt":{"rendered":"

By Max Dorfman, Research Writer, Triple-I The success of Michigan\u2019s no-fault insurance reforms at reining […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[17],"tags":[],"_links":{"self":[{"href":"https:\/\/diymakerhub.com\/index.php\/wp-json\/wp\/v2\/posts\/369"}],"collection":[{"href":"https:\/\/diymakerhub.com\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/diymakerhub.com\/index.php\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/diymakerhub.com\/index.php\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/diymakerhub.com\/index.php\/wp-json\/wp\/v2\/comments?post=369"}],"version-history":[{"count":1,"href":"https:\/\/diymakerhub.com\/index.php\/wp-json\/wp\/v2\/posts\/369\/revisions"}],"predecessor-version":[{"id":370,"href":"https:\/\/diymakerhub.com\/index.php\/wp-json\/wp\/v2\/posts\/369\/revisions\/370"}],"wp:attachment":[{"href":"https:\/\/diymakerhub.com\/index.php\/wp-json\/wp\/v2\/media?parent=369"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/diymakerhub.com\/index.php\/wp-json\/wp\/v2\/categories?post=369"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/diymakerhub.com\/index.php\/wp-json\/wp\/v2\/tags?post=369"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}