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It’s not just Michigan’s insurance lawyers that want to save No-Fault

April 13, 2011 by Steven M. Gursten

Detroit Free Press letters to the editor against proposed bills that would dismantle our No-Fault insurance system, lifetime medical care for catastrophic car accident victims

Our No-Fault insurance lawyers have been writing about the proposed Senate bills that would kill our No-Fault system and leave accident victims lacking medical care and the other invaluable insurance benefits needed to recover. For today’s blog, I wanted to share some very good letters that appeared in the Detroit Free Press. I know John Cornack and Mike Babbs and both are outstanding individuals. The concerns they raise should trouble us all.

I still would like to hear from the insurance industry or the Michigan Insurance Commissioner, Ken Ross, on why Michigan is one of the only states that does not regulate the amount of profits auto insurance companies can make. We have mandatory No-Fault insurance, but we have no mechanism to make sure these auto insurance companies are not gauging consumers with ever-higher premiums – which is exactly what they have done, and why Michigan insurance companies lead the nation in profitability.

Want to reduce the cost of No-Fault insurance in Michigan? Start with the excessive margin of insurance company profits.

Keep state’s auto insurance the best

John Cornack, President, Coalition Protecting Auto No-Fault, Lansing

It’s unfortunate to see the Free Press taking insurance industry spin at face value. I’m referring to the March 27 article “Auto insurance in Michigan highest in U.S.,” in which Michigan’s insurance rates are blamed on a state law that requires insurers to issue “unlimited” coverage for injuries in auto accidents.

The truth is, Michigan auto injury benefits are far from unlimited. It’s true that Michigan auto accident survivors are not capped on their personal injury claims, but accident victims can recover benefits only for treatments deemed to be reasonable and necessary. Insurers are on the hook only for the first $480,000 in medical expenses. Severe injuries that exceed that amount are covered by the Michigan Catastrophic Claims Association, a fund that all Michigan drivers pay into.

The fact that medical care does not stop once a $50,000, $100,000 or even $500,000 medical limit is reached means that Michigan’s severely injured accident victims have the chance of a full recovery without worrying about bankrupting their family to pay their medical bills or turning to state taxpayers for Medicaid.

It’s this basic feature that makes our auto insurance system the best value in the country and the model for No-Fault insurance.

Policyholders should start asking their insurance company to look at the most expensive part of a policy. Collision coverage accounts for 50 percent to 60 percent of the average insurance premium in Michigan. Drivers should also ask the state to provide stronger oversight of the insurance industry. Michigan requires all drivers to pay for insurance, yet there is almost no regulation over how much insurers are allowed to charge.

Cut collision rates

Michael Dabbs, President, Brain Injury Association of Michigan, Brighton

Michigan’s auto insurers continue to try to blame our state’s high auto insurance rates on our unique No-Fault system, which ensures individuals are not burdened with a lifetime’s worth of medical bills in the event of an accident.

Insurers have claimed that the allowable medical expense benefit accounts for approximately 20 percent of the Michigan auto insurance premium. However, even if you reduced the average premium in our state by up to 15 percent, we’d still be in the top-five most expensive states to insure a vehicle.

How can it be that collision insurance alone makes up more than 50 percent of average insurance premiums in our state? There are a number of states where the entire annual insurance premium is less than that, and it can’t be because their drivers collide less.

The best auto insurance system

Steven M. Gursten, Co-chair, Michigan Association for Justice, Auto Accident No-Fault Committee, Farmington Hills

Michigan drivers have the best insurance system in the country, but some Michigan lawmakers want to dismantle that system – so insurance companies can reap even bigger profits. Instead of taking a hard look at these record-breaking profits, proposed bills would dismantle important protections for drivers and shift the costs and burden to Medicaid and the taxpayers.

Michigan drivers who are seriously injured in a car crash are guaranteed unlimited lifetime medical benefits, attendant care, wage loss and replacement services – to the extent those benefits are reasonably necessary to the injured driver’s care, recovery and rehabilitation.

The Michigan No-Fault insurance system is, quite simply, one of the very best things that we have in our state.

Steven Gursten is recognized as one of the nation’s top insurance lawyers handling serious auto accident lawsuits. He routinely writes about insurance company abuse and the No-Fault laws in Michigan, and is available for comment.

Related information:

Your Michigan No-Fault insurance benefits

Why insurance company IME exams are no laughing matter

How to read your Michigan auto insurance policy

Michigan Auto Law is the largest law firm exclusively handling car accident, truck accident and motorcycle accident cases throughout the entire state. We have offices in Farmington Hills, Detroit, Ann Arbor, Grand Rapids and Sterling Heights to better serve you. Call (248) 353-7575 for a free consultation with one of our No-Fault insurance lawyers.

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