Opinion: Michigan 'no-fault' insurance coverage needs to be preserved
During over 20 years in the insurance industry, I have been on all sides of Michigan’s current No-Fault Personal Injury Protection (PIP) coverage, and my strong suggestion is it must be preserved, and moreover adopted as “best practice” throughout the country.
A few facts about the currently proposed legislation to “create options”:
- Consumers will forfeit unlimited medical coverage.
- The premium change will be something on the order of $11 per month per policyholder.
- This issue was soundly defeated in a statewide voter referendum in the early 1990s.
- A just released poll shows over 60% of consumers favor unlimited benefits.
- The current bill written by the Michigan Legislature is written to be "referendum proof," specifically so voters cannot bring it up for a vote (who knew that was even legal to do!).
- The "2500% increase in premiums over the last 12 years" becomes "23% over the last 19 years."
- One reason the fund is insolvent is that BILLIONS of surplus has been refunded to policyholders.
- No fault medical coverage, if forfeited, will lead to more and larger civil suits resulting from auto accidents...which will drive UP the cost of insurance.
- Many of those injured that require lifetime care will exceed their health coverage limits, go bankrupt, and end up in the taxpayer funded Medicaid system.
- Michigan insurance companies are among the most profitable in the industry.
The only reform warranted presently is to make PIP claims payable from the same cost guides that apply to Workers Compensation claims in Michigan. This will reduce fraud and waste in the system.
Tom Kussurelis, CPCU