From the Oakland Press.com
Michigan motorists have been the beneficiaries of unlimited medical coverage under the state’s 38-year-old No Fault auto insurance policies but that might soon change.
State Rep. Pete Lund, R-Shelby Township, has introduced a bill to limit medical coverage for accident victims, including motorists, pedestrians and motorcyclists under No Fault policies.
The motive of the legislation is to save No Fault, contain costs, increase competition for consumer dollars and give them a choice of the amount of coverage desired.
“Staggering increases in the costs of providing mandated unlimited, lifetime medical coverage as part of an auto insurance policy has pushed the price of auto insurance 20 percent to 25 percent higher than neighboring states,” according to the Coalition for Auto Insurance Reform.
During the past 10 years, the average auto insurance Personal Injury Protection medical claims rose more than 166 percent from $13,617 in 2000 to $36,245 in 2010, it said.
Under his Consumer Choice Insurance Act, motorists will have $250,000 of basic medical coverage but will be able to buy additional coverage of $500,000, $1 million and $5 million.
However, Lund and Dyck E. Van Koevering, general counsel for the nonprofit Insurance Institute of Michigan, were unable to provide the cost for consumers of buying additional coverage.
They suggested marketplace forces will push down the costs of auto insurance if there is greater competition among insurance providers.
Michigan’s No Fault insurance now provides unlimited lifetime medical coverage for those who incur catastrophic injuries such as ones that leave them paralyzed from a spinal cord injury or in a coma from a closed-head injury.
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