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Lawmakers introduce controversial no-fault changes

two cars in a rear ending accident
Steve Carmody
Michigan Radio
Opps. A fender bender in Ann Arbor. Michiganders spend a lot for auto insurance.

State lawmakers will start debating controversial changes to Michigan’s no-fault auto insurance system this week. State House Insurance Committee Chair Pete Lund introduced the legislation on Tuesday.

He says he expects to hold several committee hearings on the issue to give lawmakers time to understand and discuss it.

“I don’t know if in their time in Lansing they’re ever going to have an issue that’s quite as complicated as this. And there’s so many different pieces involved that it’s really going to take time for people to sit down, look it over, and figure it out.”

Michigan is the only state in the country that offers lifetime unlimited health benefits for people severely injured in auto-related accidents.

Governor Rick Snyder called for the changes as a way to lower auto insurance rates in Michigan.

“By making these reforms, we’ll save about $125 per vehicle. And if you have two cars in your family, it would be about $250 in reduced auto premiums.”

The legislation would cap those benefits at a million dollars. It would also require auto insurance companies to reduce their premiums by $125 dollars in the first year.

Critics argue that legislation does not guarantee rates will drop in the long run. They say it will boost insurance company profits at the expense of severely injured people.

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