The Main Act: Reforming Auto Insurance in Michigan by Normalizing Coverage Requirements, Reducing Rates, and Protecting Accident Victims
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Michigan’s auto insurance rates are the highest in the United States. The state’s unique no-fault insurance system requires drivers and insurance companies to pay for unlimited lifetime medical benefits for severely injured accident victims—a feature no other state employs. This system has guaranteed auto accident victims access to the highest levels of medical care and treatment but has also steadily increased cost burdens on Michigan’s drivers. Along with these steadily increasing insurance costs has come a growing debate about the fairness of the law, its generous victim protections, and the sustainability of its benefit structure. Several attempts at reform have been made and rejected including numerous legislative proposals and a couple of voter-driven ballot initiatives. The debate over the law and its costs to Michigan’s drivers has only continued to intensify as auto insurance fees and premiums continue to rise. This capstone proposes and offers analysis on the prospect of changing the current unlimited lifetime benefit structure to a tiered system of personal injury protection. This new approach would expand driver choice by normalizing coverage requirements, lowering premiums, and still protecting accident victims by providing access to high levels of medical coverage while aligning the structure of the system with that of other states. Entitled the MAIN Act, the proposed reforms seek to achieve the balanced solution between lowering premiums and protecting benefits recent polling has indicated Michiganders are looking for in a solution to this growing policy problem.