Lawmakers take aim at auto insurance benefits
Michigan legislators have begun addressing the issues associated with the state’s no-fault auto insurance laws. Currently, state law ensures that lifetime medical benefits to victims of auto accidents throughout the state are unlimited. This provision of the law has long been a point of contention for the auto insurance industry, which considers unlimited benefits to be somewhat excessive in most circumstances. The no-fault law has, in some regard, contributed to the growing costs of auto insurance coverage, and lawmakers are looking to address this issue soon.
Legislators move to cap medical benefits for life
Last week, a Michigan House committee approved a measure to introduce a $1 million lifetime limit on the medical benefits associated with auto insurance coverage. This is meant to put a stringent cap on the benefits that victims of car accidents can receive, thus limiting the financial losses that auto insurance companies see through such accidents. The measure is also meant to address concerns regarding auto insurance fraud, as the state’s no-fault laws make insurers particularly exposed to exploitation to some degree.
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Medical benefit cap could be detrimental
Opponents of the measure suggest that a lifetime cap on medical benefits could be disastrous; even some of the companies in the auto insurance industry have warned that the cap could cause future problems. Car accidents are unpredictable by nature and even those with the best driving habits could find themselves a victim of a disastrous accident despite their best efforts. There is no way to ensure that an accident will not happen, or that accidents will not happen repeatedly. A lifetime limit on medical benefits could be considered by some to be a punishment for something that cannot be controlled.
No-fault laws continue to cause controversy
Auto insurance costs are the primary reason behind the new measure. Various factors are contributing to the state’s growing auto insurance premiums and it can be difficult to determine which of these factors is having the most impact. For now, the state’s no-fault auto insurance laws remain a controversial issue for drivers, insurers, and state lawmakers.