A battle over your car insurance is coming to a head this week in Lansing. Insurance companies say a bill will help them lower rates, but opponents worry it could leave people injured in car crashes high and dry.
Right now in Michigan drivers are required to pay for unlimited catastrophic coverage when they buy car insurance. House Bill 5013 would change that.
The bill would allow drivers to choose whether they want $250 thousand, $500 thousand, or unlimited coverage if they suffer a serious injury. People at least 62-years-old could opt out if they have health insurance.
“That would be problematic because we know Medicare will not coordinate and provide coverage in the event of a catastrophic claim,” said Rep. Sherry Gay-Dagnogo (D-Detroit).
There are lawmakers on both sides of the aisle with concerns about the consequences. Republican Senator Mike Kowall from Oakland County says it could destroy lives.
“We don’t want people to lose their homes or life savings when a tragedy like this hits,” said Sen. Kowall.
Proponents of the bill and insurance companies say the purpose of the legislation is to lower premiums in Michigan. The bill says insurance companies would have to file paperwork if they didn’t lower the Personal Injury Protection portion of insurance by 40% after the passage of this bill.
“Michigan is the only state in the nation that mandates we all buy it right now whether we can afford it or not. We believe it is good that people have a choice,” said Lori Conarton, Communications Director at The Insurance Alliance of Michigan.
Rep. Gay-Dagnogo says there is no guarantee under the legislation that overall insurance rates would lower.
“It is gutting the system as we know it,” she said.
Lawmakers say the bill could be voted on in the House as soon as Thursday. It would still need approval from the Senate and the Governor to become law.