Policy Studies Insurance

Reforming Michigan’s auto insurance market

Michigan’s unaffordably high auto insurance premiums result in large part from its unique requirement granting all policyholders unlimited lifetime medical benefits. Higher rates of medical utilization and significantly higher reimbursements for common medical claims than those paid by Medicare or private workers compensation insurers show how pervasive the problem has become. Allowing greater consumer choice, instituting a fee schedule for medical claims and making health insurers the default handlers of major medical claims could go a long way toward making insurance rates fairer and, in many cases, lower for Michigan residents.

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