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7 reasons why auto No Fault “reform” junk mail is trash

July 30, 2013 by Steven M. Gursten

Beware: Auto insurers are littering Michigan mailboxes with misleading, self-serving propaganda

Insurance company propaganda mailings are trash

WARNING! Junk mail from Michigan’s auto insurance industry can be hazardous to your health (especially if you are ever seriously injured in an automobile accident).

Have you received mail from your insurance company in the past month?

Michigan’s auto insurance industry is sending out hundreds of thousands of what can only be described as propaganda pieces, in its latest attempt to push consumer sentiment in favor of its quite lopsided wishlist of No Fault insurance “reforms.”

As such, have the truths discussed below in hand and your recycle bins ready.

The auto insurance industry junk mail you need to watch out for comes in the form of a flyer which lays out a 7-point so-called “Common-Sense Plan For Reform.”

Given how misleading and deceptive this flyer is  (paid for by the Coalition for Auto Insurance Reform), we will review what they’ve mailed to people all over this state, and why these arguments are either completely untrue or intentionally misleading in a series of upcoming blog posts.

Drivers  need to know:

  1. The grass is definitely not greener in No Fault states with medical benefit caps – especially when you actually need medical care and other No Fault benefits (see below).
  2. Michigan auto insurance companies have failed to implement or use any  cost controls.
  3. Wrongdoing and fraud by auto insurers will continue to go unpunished.
  4. No Fault “reform” will not make auto insurance more affordable.
  5. Care  for people with catastrophic injury will be drastically reduced.
  6. No Fault “reform” will cause millions of dollars in medical care costs to be shifted from the auto insurance industry to accident victims and taxpayers, as victims are forced onto Medicaid.
  7. The profit margins for Michigan’s already highly profitable auto insurance industry will be the biggest winner as a result of No Fault “reform.”

This week, I will discuss each point from the insurance industry’s propaganda war in more detail.

Let’s start with point one:

1. The grass is certainly not greener in No Fault states with medical benefit caps

According to its propaganda mailings, Michigan’s  auto insurance industry’s plan is to: “Provide $1 million of coverage for auto insurance medical care, 20x higher coverage than the next highest state.”

But what the propaganda piece  fails to mention is that auto insurance prices are HIGHER by more than $100 per year in that state than they are in Michigan.

In New York (the state the  mailing is referring to), where No Fault medical benefits are capped at $50,000, auto insurance costs $1,207.

However, in Michigan, where the No Fault Law guarantees reasonably necessary and reasonably priced lifetime No Fault medical care for people with serious injuries, our own auto insurance costs $1,073.

Significantly, Michigan auto insurance is also cheaper by at least $100 per year than auto insurance in other No Fault states where the No Fault medical benefits are drastically lower due to benefit caps. For instance, in the District of Columbia and in New Jersey, where No Fault medical benefits are capped at $25,000 and $15,000, respectively, the prices of auto insurance are $1,277 and $1,276, respectively.

So the insurance industry is asking us to give up an enormous benefit – the protection we each receive if we or a loved one is catastrophically injured in an automobile accident – and in exchange we are only guaranteed one year of savings of approximately $100?

That seems to be a deal that only the insurance companies would love.

Related information:

The Auto Insurance Consumers’ Guide To Michigan No Fault Reform & House Bill 4612.

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2 Replies to “7 reasons why auto No Fault “reform” junk mail is trash”

  1. Thanks for this very informative article. I want to understand one thing; while these flyers (I got one last month!) are sent out under the First Amendment of the Constitution and therefore, completely under legal purview. However, the misleading information it is providing to get people on its side is under which Amendment of our Constitution? Isn’t this a shear misuse of First Amendment by sending the false and deceptive information? While they are sending out this flyers to auto-insurers, they are simultaneously flushing out millions of dollars in lobbying to make the law in their side and again by mis-leading and mis-informing the law makers wherever they can. I want know if you as a lawyer and we both as an auto insurer can do anything to stop such deceptive practices by insurance companies that they are doing?
    Thank you again,

  2. Hi Akash, Thank you so much for your comment. Unfortunately, I don’t think there is anything we can do. You can reference the political mailings from pacs as example of how it’s impossible to stop this.

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