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Details in the 91-page No Fault Insurance Reform Plan will truly shock you!

March 14, 2014 by Steven M. Gursten

In return for $110 in savings for two years, consumers and medical providers lose important legal rights and PIP No Fault Benefits  under “Substitute for House Bill 4612”

nofault reform substitute for hb 4612

You’ll be downright shocked by what House Speaker Jase Bolger (R-Marsall) and House Republicans are proposing in a House GOP “draft” bill.

I wrote last week that Speaker Bolger’s No Fault plan will cause auto insurance consumers  to lose a lot more than they’ll gain, while the reverse is true for auto insurance companies. But it’s what is in the language of this plan that are truly shocking.

Now, after having reviewed the 91-page draft “Substitute for House Bill 4612” (HB 4612 is last year’s proposal to dismantle No Fault) from Speaker Bolger and House Republicans, I know that my previous observation was a colossal understatement.

Starting with today’s blog post and continuing over the next two weeks, I will discuss some surprising  discoveries about Speaker Bolger’s and the House Republicans’ draft bill and its plan for so-called No Fault PIP “reform” in Michigan.

Here’s a full copy of the draft “Substitute for House Bill 4612.”

The draft bill is shocking by its severity. If it weren’t so seriously harmful to auto accident victims and auto insurance consumers, the extremes that this bill would reach would be almost  be laughable. But this language in the draft bill is anything but laughable.

In return for a measly 10% savings on auto insurance premiums for only two years – which equals $110 a year based on the average annual Michigan auto insurance cost of $1,100, according to the National Association of Insurance Commissioners and the Insurance Institute of Michigan – auto insurance consumers will be subjected to new taxes and assessments and a jaw-dropping array of unprecedented and permanent restrictions on their Michigan No Fault benefits and protections.

The effects of these proposed No Fault restrictions include:

  • Creating a new $25 annual HICA tax, a new “Catastrophic Claims Assessment” for the new MCCA-type organization, a new $21 million annual assessment and continuing existing MCCA assessments.
  • Capping No Fault medical benefits and limiting attendant care services, rehabilitation benefits, vehicle-modification benefits and limiting how much auto insurers have to pay for auto accident victims’ medical expenses.
  • Making it more difficult for auto accident victims to show that their medical costs are covered by No Fault.
  • Making it more difficult for auto accident victims to show they’re entitled to No Fault medical, rehabilitation, home-modification and vehicle-modification benefits.
  • Making it easier for Michigan No Fault auto insurance companies to deny and/or terminate auto accident victims’ No Fault benefits.
  • Making it more difficult for auto accident victims to challenge denials and/or terminations of No Fault benefits.
  • Creating a “witch hunt”-type of atmosphere for doctors, hospitals, therapists and other professionals who provide treatment and services to auto accident victims.
  • Creating a “Low-Cost Automobile Insurance Pilot Program” that neither guarantees a specific “low” cost for auto insurance nor provides for adequate coverage.

For more information, check out our blog post series, “Top 6 reasons to say “NO” to House Speaker’s new No Fault ‘Reform’ plan.”

Later this week, I will discuss the specific gains and losses that Michigan auto insurance consumers will experience as a result of the No Fault insurance “reform” plan that Speaker Bolger and House Republicans have set forth in the draft “Substitute for House Bill 4612.”

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