No-Fault Reform Comes Back to Lansing

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Advocates for auto accident victims have been fighting against ill-conceived no-fault reform over the past few years. And the fight is heating up again in 2017.

During the last legislative session (from 2015-2016), the Michigan legislature considered a number of no-fault reform ideas. From D-Insurance, to changes in reimbursement and priority among competing insurers, the Michigan No-Fault Act seemed under attack from every direction. This has become a ritual that Lansing has seen for over 10 years.

Now, early in the 2017-2018 term, freshman state representative Beau LaFave, from the Western Upper Peninsula has made it his mission to once again, resurrect No-Fault “reform” ideas that benefit the insurance industry and do not guarantee consumers any savings. Conservative lawmakers in Lansing have claimed that the high cost of Michigan no-fault insurance policies are making drivers opt out of mandatory auto insurance and drive illegally, yet they continue to propose “reforms” that reduce benefits but do not require insurers to reduce premiums.

LaFave says the increased premiums are particularly evident in his district, which borders Wisconsin. That state’s liability-based insurance policies cost less. LaFave wants to create optional tiers of insurance, and let drivers choose between them.

LaFave, who serves on the insurance committee for the Michigan House of Representatives, is in favor of putting a cap on benefits for the most seriously injured victims. He says these changes “could” result in significantly lower auto insurance costs.

But just like no-fault reform bills in years past, nothing in LaFave’s proposal guarantees any cost savings for Michigan residents. His plan does not include any mandatory premium reductions. Just like D-Insurance, his plan would cut off injured motorists who guessed they wouldn’t be the one to suffer a catastrophic injury.

There is no way to know whether you or your loved ones will be in a life-changing car crash. Even the most cautious driver could be struck by a drunk driver or distracted driver, or could suffer major medical consequences that last a lifetime.

Making motorists gamble with their lives every time they get behind the wheel is no way to cut costs. Instead, if no-fault reforms are necessary, they should include regulation of auto insurance premiums and industry profits, to ensure the rates are fair for motorists all across the state.

Legislators should also examine industry practices of contesting even routine auto accident claims. Regulations that limit when and how an insurance company may deny a medical claim could save money and free up congested court dockets. Cutting litigation expenses would allow insurers to lower their rates without hurting their bottom line.

No-fault reform may be inevitable, but it doesn’t have to fall on the shoulders of the state’s most vulnerable accident victims. True reforms should examine the industry as a whole and not cut benefits for the sake of industry profits.

David Christensen is an auto accident attorney at Christensen Law, with offices in Southfield, Michigan and Ann Arbor, Michigan. If you have been seriously injured in a car crash, contact Christensen Law for a free consultation.