No-Fault Auto Insurance Reform

The Issue:

While many would label Michigan’s no-fault system's medical benefits as “the best in the nation,” it is clear that cost of coverage is a real issue, as well as a general business and competitiveness issue for Michigan.

The most recent data from National Association of Insurance Commissioners (2014) draws a stark contrast between Michigan and its surrounding states. The average auto insurance premium nationwide is $982.27. In Michigan, it is $1,350.58. Michigan is the most expensive state for auto insurance, outpacing its neighboring states by hundreds of dollars. Michigan is over $496 higher than Illinois, over $621 higher than Indiana, over $583 higher than Ohio and over $633 higher than Wisconsin. Further revealing is the fact that insurance premiums in Michigan have increased more rapidly than those costs in other states. In 1997, Michigan had the 18th highest costs of auto insurance in nation. By 2007, Michigan was the 11th highest state. By 2010, Michigan ranked the 8th highest state and was the 6th most costly state 2013.

Where We Stand:

The Michigan Chamber supports the preservation of Michigan's no-fault automobile insurance law, including the prompt payment of benefits in exchange for strict limitations on the right to sue an at-fault party for non-economic damages (i.e., pain and suffering). Specifically, we support legislation to address insurance fraud and the over utilization of benefits. We also support efforts to curb discretionary billing practices by providers, bringing the cost of medical services to auto accident patients in line with payments to other patients (e.g., a fee schedule or tied to rates paid by health insurers).  

Staff Contact: 
Wendy Block
Director of Health Policy & Human Resources
(517) 371-7678
Legislative Proposals: