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Consumers’ Guide

Michigan No-Fault is far from broken or unsustainable

Although the auto insurance industry’s No-Fault reform propaganda insists on misleading the public on this point, the following facts demonstrate that Michigan’s No-Fault auto insurance system is far from broken or unsustainable:

  • “Michigan auto insurance companies collected more than $2 billion more in auto premiums in 2011 than they paid out in claims. They brought in about $6.8 billion in private passenger and commercial auto premiums and paid out some $4.7 billion in losses on private and commercial auto claims, according to data provided to Michigan Auto Law by the National Association of Insurance Commissioners and the Michigan Office of Financial and Insurance Regulation.” (Source: “Steven M. Gursten: Profits, not medical claims, drive up cost of auto insurance in Michigan,” Detroit Free Press, April 11, 2013)
  • Michigan auto insurance companies have been “highly profitable” and “significantly more profitable than the national average.” (“An Analysis of the Profitability and Performance of the Michigan Auto Insurance Market,” Jay Angoff)
  • The Michigan Catastrophic Claims Association’s had approximately $21 billion in reserves (i.e., the amount of money it sets aside or saves to pay for present and/or future open catastrophic claims) in 2017, according to the MCCA data.
  • There were 77 auto insurance companies doing more than $1 million in business in Michigan in 2017, and State Farm Mutual Automobile Insurance Company, alone, took in more than $1.6 billion in auto premiums in 2017, according to data from the Michigan Department of Insurance and Financial Services.
Michigan has a new auto No-Fault law. Click Here to learn more.