Reforms exclude certain populations for payment eligibility.
A number of Michigan auto insurance bills which each contain an exclusion for certain populations from being able to collect payments under the no fault law in the state, have passed a House committee.
This underscores the legislative attempts to change the system that is compensating injured people in car accidents, no matter who caused it to happen. Those supporting the bills have said that the number and size of the payouts from the personal injury protection (PIP) system have spiked over the last ten years, making it very difficult for drivers in the state to find an affordable coverage. They believe that this requires the state to reform its no fault laws so that the standards become more exclusionary.
The House bills regarding Michigan auto insurance are 4993, 5587, 5588, and 5589.
These four pieces of legislation have been recommended as amendments to those that have already been passed by the House Committee on Insurance. The House is now facing them for greater consideration.
From 2002 through 2011, the average claim made through the PIP system rose from a cost of $6,674 to $19,523.
This data was provided by the sponsor of HB 5589, Ben Glardon (R-Owosso). That bill would stop passengers riding in stolen vehicles from being able to receive no-fault benefit payments. According to Glardon, “Anyone who is involved in committing a crime should never be able to collect benefits if they get into a car accident in the process.”
Committee members heard public testimony on the topic throughout two hearings in the month of May, where a number of advocacy groups stated that the bills used language that was too broad when they defined the criteria for exclusion.
According to the Michigan Brain Injury Provider Council (MBIPC) president, Lynn Brouwers, this type of overreach could lead to unanticipated outcomes. Brouwers gave her testimony on May 31, in opposition to HB 5588, which stops drivers who are intoxicated and who are in an accident from being able to benefit from PIP compensation.
According to Brouwers, it doesn’t take into consideration that the Michigan auto insurance industry still has a “big problem with drug testing.”