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The Ending to Michigan’s No-Fault Fairy Tale Needs to be Changed

Michigan voters were promised real savings with the no-fault law reform in 2019. What we received instead is a not-so-happy ending to a fairy tale where the big bad wolf wins.

Recent headlines tell the story. First, there’s the double-digit rate increases even for the most prudent and safe drivers. The “rebate” sent to Michigan residents was an illusion. We remain one of THE most expensive states for average auto insurance premium costs – 2nd only to Louisiana according to a Spring 2022 MarketWatch article. That was NOT the promise made to us or the deal sold to us. Instead, it was fodder used as political window dressing.

Second, there appears to be a mysterious, multi-billion-dollar deficit in the Michigan Catastrophic Claims Fund that is just one of the reasons now used by the insurance industry to as an excuse to AGAIN increase already “catastrophically” high premiums according to WXYZ-TV in Detroit and several other media outlets. An adverse 2019 Michigan Court of Appeals ruling against the insurance industry and slumping stock market investments are other given by insurance companies for higher premiums.

But most troubling is a story that isn’t being widely told. The number of healthcare providers who will treat victims of auto accidents are disappearing by the day. According to Michigan Radio, there are very few nursing homes or home healthcare agencies willing to accept auto accident survivors. Why? The auto industry, as part of the midnight “behind closed doors” deal made by politicians enacted a fee schedule that makes it financially impossible for most qualified medical providers to stay in business.

These providers have no confidence that they will actually get paid even at reduced rates. The architects of auto insurance “reform” promised more consumer choices and lower premiums. Sounds too good to be true? It is!

Additionally, more than 4,000 healthcare worker jobs have been eliminated and nearly 7,000 auto accident victims discharged from their full-time care due to the reforms from the ill-fated 2019 law, according to a 2022 study by the Michigan Public Health Institute.

Plus, we have no idea that monies in the Catastrophic Claims Fund – assuming it isn’t broke – will account for the inflationary increase in healthcare costs. So even consumers who smartly choose the unlimited PIP benefits in their policies are still not fully protected.

It's time for Michigan’s drivers to demand change – and now. The next catastrophic car accident victim to be denied the care they need to recover could be your neighbor, a family member, or you. Without new no-fault reform, all of us are just a pending statistic.