LANSING — The cost of insuring a vehicle in Michigan will increase by $11 per car or $22 for the average family. The increase is a result of the insurance assessment to pay for the Michigan Catastrophic Claims Association that reimburses insurance companies for the cost of providing unlimited medical benefits to all Michigan drivers. The cost to fund the MCCA is increasing by 6 percent from $175 per car to $186 per car.

The Michigan House Insurance Committee passed a bill, HB 4612, out of committee earlier this year designed to put in place cost controls and roll back the price of insurance by $125 per vehicle in the first year alone, but the proposed legislation is still waiting for a vote on the House floor.

“This should be another wake-up call to the Michigan legislature to act on no-fault reform when they return to session in the fall,” Kurt Gallinger, chair of the Michigan Insurance Coalition, said. “Something has to be done to end the gouging of Michigan drivers by Michigan hospitals, and others in the medical community, who are charging auto accident patients three to five times higher rates than anyone else. They are responsible for driving the cost of auto insurance through the roof.”

In the past 14 years, the mandated cost for providing unlimited health care benefits for drivers through the MCCA has increased from $5.65 per car to $186 per car.

“Michigan’s no-fault system is the last blank check in the U.S. healthcare system,” Robert Hartwig, president of the Insurance Information Institute, said. “No other state in the nation provides unlimited no-fault benefits, and for good reason: with unlimited benefits come unlimited costs that fewer and fewer people are able to afford.”

The Coalition for Auto Insurance Reform supports the approach taken by State Rep. Pete Lund in House Bill 4612 that would lower the cost of auto insurance by limiting medical provider’s charges to the same price paid by private insurers like Blue Cross, provide up to $1 million in medical coverage through their auto insurance and establish a fraud authority to combat auto insurance fraud.

Facts About Michigan No-Fault Insurance