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The truth about Michigan auto insurance rates

truth about Michigan auto insurance rates

Even though  “lowering Michigan auto insurance rates” is the  driving force behind efforts to reform Michigan’s No Fault auto insurance system, the truth is that none of the authorities and experts on insurance can agree as to whether rates and prices are going up, going down, or  what the prices actually are.

  • Data and statistics from the Insurance Institute of Michigan (IIM), the Insurance Information Institute (III) and Insure.com show that Michigan auto insurance rates in recent years were lower than in previous years.
  • Moreover, (and here’s the kicker) studies by IIM, the Insurance Information Institute and other insurance industry trade organizations reveal conflicting information about how much Michigan auto insurance costs. Prices fluctuate wildly.  Rates can vary  from $934.60 on the low end to $4,490 on the high end.

For more information, click here to read a comprehensive analysis of Michigan No Fault reform and the latest developments.

The Michigan Insurance Commissioner is R. Kevin Clinton. He is clearly the person who is in the best position to weigh in on this issue and provide facts and clarity, yet he has chosen to stay on the sidelines. Mr. Clinton has said next to the nothing publicly, except for his February 23, 2013, letter, which was released only to the media. In the letter, he claimed that Michigan auto insurance consumers have been beset by “double digit premium increases.”  Mr. Clinton has also bowed out of interviews, such as the one on NPR with Erica Coulston, at the last minute.

He has also refused to make information publicly available so the public and legislators can make educated decisions on No Fault reform, drawing the ire and condemnation of Republicans, such as Oakland County Executive L. Brooks Patterson.

Instead, Mr. Clinton has chosen mostly to use his role to make provocative, but sadly unsubstantiated, comments from the sidelines. Perhaps he forgets he is no longer working for the insurance industry, as he was when he was appointed to the job.  He now represents the consumers of the state of Michigan.  And now would be a great time for the Insurance Commissioner to provide the public and lawmakers with information that would allow them to make good choices for their pocketbooks and for the future of Michigan’s No Fault Law.

A great place to start for the Insurance Commissioner and the Michigan Office of Financial and Insurance Regulation would be by resuming OFIR’s annual publication of the “Buyers’ Guide To Auto Insurance,” which provides auto insurance consumers with extensive, detailed rate information for approximately 60 auto insurers in 16 major Michigan cities.

Insurance Institute of Michigan

“Auto insurance prices in Michigan are reasonable – especially considering the high level of benefits provided to consumers,” wrote the Insurance Institute of Michigan in its 2010 IIM Fact Book and in its 2012 IIM Fact Book.

The IIM’s assessment is consistent with the data from the National Association of Insurance Commissioners (NAIC) that the IIM relies on for its “Auto Rates Premium Comparison By State” statistical publication.

According to the NAIC data, the average automobile insurance premium in Michigan was lower in 2010 than it was in 2003, 2004, and 2005:

  • 2010 average Michigan auto insurance premium: $1,073.52
  • 2003 average Michigan auto insurance premium: $1,088.15
  • 2004 average Michigan auto insurance premium: $1,128.16
  • 2005, average Michigan auto insurance premium: $1,088.97

 – IIM Auto Rates, Premuim Comparison by State, IIMinfo.org, Auto Insurance Reform

Insurance Information Institute

The average Michigan auto insurance expenditure, i.e., “what [Michigan] consumers actually spend for insurance on each vehicle,” was lower in 2010 than it was in 2003 and 2004:

  • 2010 average Michigan auto insurance expenditure: $934.60
  • 2003 average Michigan auto insurance expenditure: $950
  • 2004 average Michigan auto insurance expenditure: $980

 – III.org, auto insurance facts and statistics

Insure.com

The average Michigan annual auto insurance premium was lower in 2013 ($2,520) than it was in 2011 ($2,541), and it was lower in 2012 ($2,013) than it was in 2011 and 2010 ($2,098.29).

How much is Michigan auto insurance?

  • $934.60 (Insurance Information Institute/Average Michigan auto ins. expenditure for 2010)
  • $1,073 (Insurance Institute of Michigan/Average Michigan auto insurance premium for 2010)
  • $2,520 (Insure.com/ Average Michigan annual auto insurance premium for 2013)
  • $4,490 (CarInsuranceQuotes.com/median Michigan price of annual car insurance for 2012)

For more information, click here to read a comprehensive analysis of Michigan No Fault reform and the latest developments.

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Blog Author Steven M. Gursten
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