There are more than 50 auto insurers selling policies to Michigan drivers, including all of the popular national auto insurance companies. Michigan also has many local and regional auto insurance providers, including Michigan Farm Bureau and Frankenmuth Mutual.
Largest Michigan Auto Insurance Companies, by Premiums
For a complete list of Michigan auto insurance companies, you can go to the official site for the Michigan Department of Insurance and Financial Services. Unfortunately, you can only sort their list by “Property and Casualty Entities,” which gives you automobile, homeowners and property insurance companies. And the list doesn’t specify which of these types a company is. Bottom line: You need to do your research.
Michigan’s auto insurance reform law allows drivers to opt out of buying unlimited personal injury protection (PIP), but they need higher liability limits. Michigan’s auto insurance reform law changed the state’s car insurance requirements for policies issued or renewed after July 2020. Michigan’s insurance reform also decreased the Michigan Catastrophic Claims Association (MCCA) fee, which drivers must pay if they purchase unlimited PIP insurance.… read full answer
Michigan Auto Insurance Reforms After July 2020
Drivers need $250,000 in personal injury protection per person, with lower limits or exclusions allowed for drivers with Medicare, Medicaid, or qualified health care.
Insurers must offer an optional supplement to PIP insurance that covers attendant care, such as home nursing.
Insurers must offer $3,000 in limited property damage liability insurance, which applies if you are 50% or more at fault in an accident and the other driver sues you for vehicle damage.
Michigan has some of the most expensive car insurance premiums in the country, as well as high fraud rates. To combat this, Michigan’s auto insurance reform law implemented several new consumer protections.
Consumer Protections Created by Michigan’s Auto Insurance Reform Law
Insurance companies can no longer consider gender, home ownership, marital status, credit score, educational level, occupation, and ZIP code when determining rates.
Drivers cannot be penalized for a lapse in auto insurance coverage as long as they apply for insurance by January 1, 2022.
Michigan insurers must reduce PIP premiums, and all premiums need to be approved by the Department of Insurance and Financial Services.
A new fraud investigation unit was formed.
Fees and penalties for insurance companies who violate laws increased.
Car insurance in Michigan is expensive because it's a no fault state with high insurance coverage requirements. But the biggest reason Michigan drivers pay more for car insurance than anyone else in the country is that it is the only state with unlimited. In Michigan, you can expect to pay approximately $6,310 per year for full coverage car insurance or $2,197 per year for minimum coverage. Car insurance in Michigan is more expensive than the national average, which is around $2,000 annually for … read full answerfull coverage and about $700 per year for minimum coverage.
The cost of car insurance is steadily increasing, too, both in Michigan and nationwide. As the cost of providing insurance goes up, the premiums insurers charge also rise. All insured drivers share the increasing cost of insurance. That is why your rates tend to go up every time your policy is renewed, regardless of whether any individual factors—like your driving record or location—have changed.
There are several unique reasons why car insurance goes up every year in Michigan, too, even if your details remain the same.
Top Reasons Car Insurance Is Expensive in Michigan
People in Michigan are driving more. As a result, the number of accidents, claims, and payouts is rising, too. For example, there were approximately 1,011 fatal crashes in 2020 in Michigan, versus 896 fatal crashes in 2015.
Auto repairs are getting more expensive. Vehicles today cost more to repair due to the added technology and features. For example, a National Association of Insurance Commissioners study found that the average cost of vehicle repairs was around 8% higher in 2018 than it was in 2014.
People in Michigan drive uninsured. As the cost of car insurance continues to rise, more drivers take the risk of driving without car insurance. In 2019, 26% of drivers lacked even minimum liability insurance in Michigan. The cost of uninsured drivers is passed on to consumers through higher premiums.
Healthcare in Michigan is getting more expensive. Car insurance companies are hit hardest when paying out claims involving medical bills, and it’s not getting any cheaper. Healthcare spending increases by an average of 5.2% every year in Michigan.
Michigan is experiencing more severe weather. In Michigan, weather events like severe storms, serious winter weather, and droughts are becoming increasingly common. These weather events cause insurers to pay out a higher number of claims, which tend to be more expensive and less predictable. As a result, they have to raise rates to keep pace.
However, there could be other issues elevating your rates.
If your driving record is clean and your rates are still high, your car insurance might be expensive because of your:
Age. Drivers under 25 and older than 65 pay more for auto coverage because they are statistically more likely to be involved in serious and fatal accidents. In Michigan, 16-year-old drivers pay an average of $4,704 per year, 25-year-old drivers pay an average of $1,392 per year, and people over 65 pay an average of $1,305 per year.
Location and driving patterns. Population-dense cities have higher premiums than rural areas because city living usually means more accidents, more property crime, and more frequent claims. In Michigan, the most expensive locations for insurance are Brockton, Dorchester Center, and Dorchester. You can also expect rates to change based on your driving patterns—long commutes or regular driving in high-risk areas can cost you.
Financial responsibility. You can demonstrate financial responsibility by maintaining minimum car insurance with no gaps in coverage. Letting your coverage lapse could result in a higher rate when you get your next policy.
Claims history. Numerous recent claims can drive up your premiums. That's one reason why it sometimes makes sense to pay out of pocket rather than file a claim, especially if a claim won’t get you much more than your deductible.
How to Get Cheaper Car Insurance in Michigan
Multiple factors affect the cost of car insurance. Some things you can’t control, but you do have a say in most of the contributing factors. Driving safely, obeying traffic laws, and keeping a clean driving record are the best ways to keep your insurance costs down.
Other than that, the best way to lower your car insurance costs is to compare rates from at least three insurance companies. Ideally, you should check your rates every 6-12 months, when you renew your policy. But at a minimum, be sure to check your record and shop for rates every three to five years, since you may be able to get a lower rate if a traffic violation falls off your record.
In Michigan, the most expensive policies cost roughly $5,491 per year, and the least expensive coverage costs around $635 per year, when all driver profile information is the same. That means you could save as much as $4,856 simply by shopping around. Be sure to confirm you’re getting all the discounts you’re eligible for, too.
Michigan car insurance laws require $50,000 of bodily injury liability coverage per person (up to $100,000 per accident) as well as $10,000 of property damage liability coverage. Additionally, Michigan drivers need to carry personal injury protection (PIP) and $1,000,000 in property protection insurance. Most drivers will need to purchase at least $250,000 in PIP, though there are some exceptions for Medicare and Medicaid recipients.… read full answer
Michigan’s insurance laws are unique, since it is the only state that requires property protection insurance (PPI). PPI covers damage to other people’s property within the state of Michigan, such as buildings, mailboxes, and parked cars. It does not apply to moving cars or to accidents that take place outside of Michigan. Additionally, Michigan is a no-fault state, meaning that drivers file most injury claims with their own PIP coverage.
Minimum Coverage Required by Michigan Car Insurance Laws
Bodily injury liability: $50,000 per person / $100,000 per accident
Property damage liability: $10,000
Personal injury protection: $250,000 for most drivers
Property protection insurance: $1,000,000
Uninsured motorist insurance: Not required
You can face multiple penalties if you’re caught driving without at least the minimum car insurance required in Michigan.
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