The proposed changes to the auto insurance laws are being vehemently opposed by the Michigan Democrats. This includes putting an end to the unique requirements for covering those injured in accidents. The Democrats have stated that they would be opposing these changes to the auto insurance system in Michigan.
Till date, only the state of Michigan mandates that those who are seriously injured in accidents get uncapped medical coverage. As per the new proposals that may be considered in the GOP-led house, the motorists will have to choose between the $500,000, $1 million, or $5 million in PIP or Personal Injury Protection coverage.
Those who support these changes state that this could lessen the burden of auto insurance and motorists will now have a choice as they can choose insurance that is less expensive. However, the opponents claim that there is absolutely no guarantee that there will be any reduction in rates.
The Democrats state that those who opt for lesser coverage may be underinsured and could get into serious financial trouble in case of serious injuries in any mishap.
Rep. Phil Cavanagh, D-Redford has stated that these changes will only cushion the insurance companies, rather than protect the consumer.
There are many Republicans who have supported the proposed changes as they feel that motorists will have better choices and will possibly have to pay lower premiums as well. They claim that the existing law has actually driven up the auto insurance costs and this may be one of the contributing factors for having uninsured or underinsured drivers.
According to the present law, regular auto insurance policies can handle coverage up to $500,000 by way of medical costs. If the costs go over this amount, the motorists are assessed additional fee to cover the more severe cases, which are then reimbursed via the Michigan Catastrophic Claims Association. This association was created during the late 1970s, but it now handles coverage for approximately 12,800 accident victims all over the state of Michigan.
The ones that are already part of the MCCA system will continue to be eligible for the existing coverage; however such guaranteed coverage will not be available for the ones that are injured in accidents in the future.
Those who are opposing the proposed legislative changes state that some limits will be placed on the in-home assistance for the accident victims who are already part of the MCCA system.
