Most Michigan motorists will see slight decrease in personal injury protection cost starting in July
The annual assessment for personal injury protection coverage under Michigan's no-fault auto insurance laws will go down slightly in July for most motorists, according to data provided Friday.
The Michigan Catastrophic Claims Association, the private association that is the state's reinsurer for auto insurance companies, reported in a press release Friday that the fee will be $82 per vehicle for drivers selecting the unlimited PIP plan and $23 for those selecting other coverage limits.
Nearly 70% of Michigan residents choose the unlimited plan.
The 2024 assessments, which are currently in effect, are $90 per vehicle for the unlimited option and $20 for those selecting other coverage levels.
Michigan has a unique auto insurance system as compared to other states in that unlimited personal injury protection is available for those who are catastrophically injured in auto crashes. With the collection of the annual per vehicle assessment fee, the MCCA reimburses auto insurance companies for unlimited PIP claims costing more than $635,000.
Calculations for the annual assessment are based on the number of insured vehicles in the state. Most companies then pass on the assessments to their policyholders.
Before the 2019 auto insurance no-fault reform bill was passed, the assessment for Michigan drivers was $220 a year for every vehicle with everyone placed in the unlimited PIP pool. There also were cost controls built into the 2019 law; and legal disputes have resulted on how to handle lingering medical claims for accidents occurring before that date.
"When we look at the data, we can clearly see the positive effects of the 2019 bipartisan auto no-fault reforms, with out-of-control medical costs decreasing for many of the costliest procedures," said Kimberly Bezy, executive director of the MCCA.
"People now have the choice to pick the appropriate level of PIP coverage for themselves for the first time, with 31% of Michigan drivers choosing less than unlimited PIP as of summer 2024. It is clear the reforms are truly making a positive difference for Michiganders and it's clear that Michigan consumers value having more choices for their medical coverage."
The MCCA was created in 1978 to handle the reinsurance needs.