Michigan car insurance fee falling to $100 a vehicle in July

LANSING (AP) — Michigan drivers who want unlimited medical coverage for crash injuries will pay $100 per vehicle starting in July, which will be 55% less than the record-high $220 annual fee they currently pay.
The Michigan Catastrophic Claims Association, a state-created nonprofit entity that reimburses auto insurers for health care claims surpassing $580,000, announced the cut Wednesday. The move came roughly five months after the passage of a law making the mandatory fee optional beginning next summer, as part of a plan to lower rates in a state with the country’s most expensive average premiums.
Motorists who forego personal protection benefits entirely — they can do so if they have Medicare or separate health insurance that covers car crash-related injuries — and those who choose less coverage will avoid the assessment altogether, said MCCA executive director Kevin Clinton.
The $100 fee will be the lowest in 17 years. The portion of the fee that covers a fund deficit, $43, will fall to $0 because the deficit has been eliminated, he said. The total fee was $100.20 in 2003-04.
“Today’s reduction by the MCCA demonstrates that our historic bipartisan legislation will provide real savings to Michigan drivers,” Democratic Gov. Gretchen Whitmer said in a written statement.
Lawmakers and the insurance industry, whose members sit on the MCCA board, also said the steep fee decrease is proof that the changes signed into law will work.
The announcement “is just the first in what we hope is a series of cost savings for Michigan drivers,” said Tricia Kinley, executive director of the Insurance Alliance of Michigan.