Under Michigan’s new auto insurance law, everyone loses, except big auto insurance companies.
Consumers
Drivers who purchase policies with PIP caps who sustain catastrophic injuries will spend their benefits within a few weeks, if not sooner. Yet many of those drivers will require care for the rest of their lives. Meanwhile, any dollars saved through reduced PIP premiums will likely be offset by increases in liability premiums required under the new law.
Seniors
Seniors on Medicare who opt out of injury protections will lose access to long-term care, residential treatment programs, case management services, vehicle modifications, and more.
Pedestrians and Cyclists
The new law caps at $250,000 the amount of care you will receive if you’re a pedestrian, cyclist, senior who no longer drives, children riding in uninsured vehicles, or anyone involved in a car accident who doesn’t have auto insurance.
Medical providers
The post-acute care industry, which provides rehabilitation services to victims after they leave the hospital, will be destroyed by the arbitrary fee schedule imposed by this law. It will force many care providers to close their doors and layoff thousands of employees, hurting Michigan’s economy.
Urban residents
The reduction in PIP premiums is based on the statewide average. So, if you live in an area with historically high rates like Detroit, the reduction you’ll see will be significantly less than residents in other areas.
Motorcyclists
The new law eliminates guaranteed lifetime coverage for motorcyclists involved in car crashes—instead, if they are in an accident, their level of care will depend on the level of coverage carried by the car driver who caused the accident – regardless of the level of PIP coverage they purchased under their own auto policy.
Businesses
Michigan businesses renewing their fleet insurance are already experiencing significant increases in their premiums due to the legal exposure the PIP choice options create. In addition, healthcare insurance will likely increase as health insurers will need to shoulder the costs of auto accident injuries.
Taxpayers
With fewer benefits available, more accident victims will be forced into medical bankruptcy and onto Medicaid, which is paid for by Michigan taxpayers.
Families
The new law will limit reimbursements for family members who care for accident victims to 56 hours per week. Many of these victims require around-the-clock care, and family members often have to quit their jobs to care for them. Now they will be forced to hire outside agencies to care for their loved ones and allow strangers in their homes.