Whitmer announces auto insurance reform law, saving as much as 62% on premiums

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LANSING, Mich. (WLNS) — A new law signed by Governor Gretchen Whitmer will be saving Michiganders between 25 and 62% on the Personal Injury Protection (PIP) medical portion of their car insurance policy.

Lower premiums will save drivers more on top of the expected refund that will be distributed after the Michigan Catastrophic Claims Association (MCCA) voted unanimously to deliver refund checks to every Michiganders with auto insurance.

Michigan drivers called for relief from high auto insurance rates for decades, and I am pleased that this bipartisan legislation has resulted in savings, increased consumer protections, and more consumer choices than ever before. Drivers are able to choose the coverage level that best meets their families’ needs and budget, and even those who’d like to keep unlimited coverage, which provides the nation’s most generous benefits, are still saving money.” 

Gov. Gretchen Whitmer

The new auto insurance law has been in place for more than a year.

Data from rate filings approved under the new law show that the average statewide (PIP) medical reductions exceeded the statutory requirements in 2020, and that those savings have further increased in 2021, even when rates are adjusted for the increased mandatory Bodily Injury (BI) coverage level.

PIP Limit Mandated PIP Medical Reduction  (compared to average statewide rate on  May 1, 2019) 2020 Average  Statewide  Reduction*  (As of 7/2/2020) 2021  Average Statewide Reduction*  (As of 7/2/2021) 
Unlimited  At least -10%  -15%  -25% 
$500,000   At least -20%  -31%  -39% 
$250,000   At least -35%  -42%  -48% 
$50,000   At least -45%  -53%  -62% 
* These savings represent the statewide average reduction. Savings experienced by individual consumers may be different based on their choice of coverage and factors related to their personal situation, such as driving record and claims history.

Gov. Whitmer reminded drivers who let their auto insurance lapse that time is running low to take advantage of purchasing insurance penalty-free before January 1, 2022.  

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