What is Michigan's auto insurance reform law?

Question

You can get car insurance discounts in Michigan based on how you drive, the car you own, and your relationship with your insurance company. Michigan insurers are not allowed to consider factors like gender, credit score, educational level, occupation, home ownership, ZIP code and marital status when setting premiums.

Almost anyone can get a discount on car insurance in Michigan because most insurance companies make it easy to qualify for a variety of savings. Michigan insurers typically offer discounts that fall into one of three categories—policy discounts, driver discounts, and vehicle discounts.… read full answer

Policy discounts typically reward customer behavior that is desirable to the insurance company. For example, most Michigan drivers can save by registering for paperless billing or getting both home and auto policies from the same company. Driver discounts are available to Michigan residents who are lower-risk to insure, like those with clean driving records. And vehicle discounts help drivers save if their car has certain safety features or anti-theft systems.

Car Insurance Discounts in Michigan

Discount	How It Works	Potential Savings
Customer Loyalty	Insurance companies reward long-term customers with lower rates.	Up to 10%
Good Driver	Drivers with a clean record and no claims history save on insurance.	10% to 30%
Driver Education	Older drivers who refresh their skills with an approved defensive driving course get reduced rates.	5% to 10%
Billing and Payments	If you pay for your policy in full, set up automatic payments, pay online, or go paperless, you can save.	2% to 25%
Policy Bundling	Insure multiple vehicles or get different policy types (like home and auto) from the same company can earn a discount.	1% to 12%
Good Student	Young drivers with a “B” average or higher are eligible for discounts.	5% to 20%
Usage-Based	Some insurance companies offer discounts for drivers who are willing to have their driving habits monitored by an electronic device attached to your car and/or your smartphone.	1% to 30%
Safety Features	Cars featuring multiple airbags, anti-lock brakes, daytime running lights, and other safety add-ons can save on car insurance.	2% to 30%
Anti-Theft Systems	Car alarms, LoJack, steering wheel locks, or other anti-theft features can make comprehensive coverage more affordable.	5% to 25%
Continuously Insured	Drivers who have been insured for 6 months or more save on insurance (beginning in 2022).	5% to 25%

Remember, discounts vary among different insurance companies, so it’s always best to contact the provider directly to determine which discounts you qualify for.

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Answer 1 · 2021-06-29 10:10:19

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@WalletHub • 06/29/21 This answer was first published on 06/29/21. For the most current information about a financial product, you should always check and confirm accuracy with the offering financial institution. Editorial and user-generated content is not provided, reviewed or endorsed by any company.

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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.

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.
Drivers need $50,000 in bodily injury liability coverage per person ($100,000 per accident), plus $10,000 in property damage liability coverage for accidents outside the state.
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.

To learn more, check out WalletHub’s guide to Michigan’s car insurance requirements.

SR22 Needed After	Serious traffic violation and/or license suspension
Required For	3 years
Average Cost Increase	$100
Min. Bodily Injury Liability Coverage	$50,000 per person / $100,000 per accident
Min. Property Damage Liability Coverage	$10,000
Additional Coverage Needed	$250,000 in PIP$1,000,000 in PPI

PIP required?	Yes, PIP is required
Minimum PIP coverage	$250,000 of PIP for most drivers
Annual cost of insurance	$1,908
State accident laws	no-fault
National cost ranking (1=cheapest)	50

What is Michigan's auto insurance reform law?

WalletHub, Financial Company

Michigan Auto Insurance Reforms After July 2020

Consumer Protections Created by Michigan’s Auto Insurance Reform Law

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