State leaders are encouraging residents to do so before the amnesty period runs out and rates increase.
Michigan state leaders are pushing for uninsured drivers in the state to get their auto insurance coverage fast before premiums start rising when the amnesty period expires.
The amnesty period is a component of the no-fault reform legislation in the state.
The new legislation became effective in July 2020. The amnesty period was put in place to provide uninsured motorists with a reprieve, giving them the chance to obtain their legally required auto insurance coverage without rate increases or facing a penalty. That said, the period will be expiring at the end of the year. This means that drivers who have not purchased coverage by January 1, 2022 will face penalties and higher premiums.
Detroit Mayor Mike Duggan held a press conference in which he stated that the amnesty has encouraged over 100,000 drivers in the state to get a policy.
“The single biggest reason for passing this legislation was for those folks of moderate-to-low income who were driving uninsured and were at risk every day,” said Duggan. “If you haven’t had car insurance for some time, you can be put at higher risk and when you go to buy it, the insurance company can charge you a higher rate than other drivers.”
The mayor also urged uninsured drivers to get their auto insurance coverage now for lower rates.
Michigan Department of Insurance and Financial Services (DIFS) Director Anita Fox underscored how important it is for every motorist in the state to have car insurance, as it provides residents with protection.
She also pointed out that among the 100,000 drivers who obtained their policies to take advantage of the amnesty period, around 60,000 had not had a policy for at least three years.
“Michigan had the greatest benefits in the nation, but with that, we also had the highest costs and with the highest cost, we had a disproportionate number of uninsured drivers putting all of us at risk,” said Fox.
Before the reform to the no-fault laws in the state, the average cost of auto insurance coverage in Michigan had been higher than $5,000 per year. The legislation was signed by Governor Gretchen Whitmer in 2019, ending the requirement that drivers in the state purchase policies guaranteeing uncapped lifetime medical benefits should they suffer injuries in a collision.