Have You Ever Contemplated Finance?

Have You Ever Contemplated Finance?

[Insurance]

ET Nov. 25, 2020 | Updated 5:52 p.m. ET Nov. 25, 2020 Michigan drivers will see a $14 decrease in their catastrophic claim fee in the coming year, the second decrease in the 18 months since state continue reading leaders adopted historic auto insurance reform.  The change brings the fee from $100 to $86 a year after the Michigan Catastrophic Claims Association lowered the fee from $220 to $100 or no payment at all.  The $86 fee will be charged to people who maintain unlimited lifetime personal injury protection benefits between July 1, 2021, and June 30, 2022.  Those who chose lower tiers of coverage will not pay the fee.  The catastrophic claim fee pays for catastrophic car crash injuries and is overseen by the Michigan Catastrophic Claims Association.  (Photo: Robin Buckson / The Detroit News) The catastrophic claim fee pays for catastrophic car crash injuries and is overseen by the association, a group created by the Legislature in 1978. The association reimburses auto insurance companies after a certain threshold, set at $600,000 for the coming year, is reached for medical costs. The 2019 changes to the law, which allowed many to opt out of lifetime personal injury benefits, helped the Michigan Catastrophic Claims Association to reduce its liability by $3.5 billion and eliminate a $2 billion deficit.  House Speaker-elect Jason Wentworth, the Farwell Republican who led the 2019 auto insurance reform effort in the House, praised the $14 decrease as evidence that the reform was successful.  “Especially in these uncertain times, it’s more important than ever that Michigan drivers keep as much of their hard-earned income as possible,” Wentworth said in a statement. Gov. Gretchen Whitmer said the 2019 law is "putting more money in the pockets of Michiganders." "The reduction in the MCCA annual assessment is another example of how the reform is helping to reduce costs and provide savings for Michigan families,” Whitmer said.  The Insurance Alliance of Michigan also praised the decrease and encouraged the state to stay the course as the medical fee schedule, a critical piece of the 2019 law, goes into effect July 2, 2021. “We’re hearing from drivers across the state who are saving hundreds and even thousands of dollars on their auto insurance premiums under the state’s new law," said Erin McDonough, executive director for the Insurance Alliance of Michigan. "We urge lawmakers in both parties to let these reforms continue working and push back on special interests who want to turn the clock back on these historic reforms."  Prior to the 2019 reform, Michigan had some of the nation's highest auto insurance rates in the nation, largely because state law required all motorists to pay for uncapped lifetime medical benefits in the event of catastrophic crash injuries.

https://www.detroitnews.com/story/news/local/michigan/2020/11/25/michigan-auto-insurance-fee-decrease-14-dollars/6426624002/

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