A lot of people complain about prohibitive car insurance fees that almost cost an arm and a leg. Some people opt not to sign in to one not seeing any practicality to something that is rarely used, but can burn a hole in one’s pocket. In these challenging times where every buck counts, a lot of people would view car insurance as a nuisance and unnecessary. They would rather use the money for more important matters.
In Michigan, local politics is making headway in alleviating people’s financial woes with a State election panel approving an earlier petition to conduct a ballot proposal the next year. This has an objective to cut car insurance premiums down by 20%.
This landmark decision of the State election panel could pave way to cheaper and affordable car insurance rates for Michigan residents. With the state not exactly spared by recession, rate changes would be a welcome relief to most local drivers. For this proposal to pass, backers must be able to muster 300,000 signatures. In the event that supporters of this measure will be able to come up with the required numbers, the proposal would be included on ballots in the upcoming 2010 elections.
This proposal is not only limited to rate downgrades, but also advances consumer welfare by providing legal measures that would protect consumers from unjust business practices as well as outlining guidelines that would serve as a benchmark in creating extensive coverage for everyone.
Insurance corporations are raising a howl and stated that this proposal runs against sound business practice, which could ultimately lead to business failure. They added that rate decreases would affect their profit margins and would make business models inefficient and uncompetitive.
Proponents of this proposal believe otherwise, citing reported earnings of top insurance companies in the U.S., which ran easily into millions; State Farm alone reporting a $5 billion profit in 2008. They believe that insurance companies are merely trying to protect their already healthy margins and are not willing to compromise their financial standing.
The ball is now in the court of Michigan voters and the future of this proposal is in their hands. A strong outcry of support would take this proposal closer to becoming a reality. Supporters are hoping that Michigan residents will rise up to the occasion and would allow the proposal to move forward. They are hopeful that come 2010, their germ of an idea would become a law and that cheap car insurance coverage would become the norm in the state.