Many people were surprised to learn that Michigan's MCCA fee won't increase this year. After all it seems to have gone up steadily for the last several years. But this year, lawmakers have been pressured to overhaul the auto insurance system. That probably played a big influence on why the fee didn't go up like it was expected to. But hey! I'm certainly not going to argue! Even though it still stands at a high amount ($186 per year per vehicle), I was really expecting it to break the $200 barrier this year.
Also the threshold in which the auto insurance stops paying and the MCCA fund starts paying stayed the same as well at $530,000. This threshold has also risen considerably in recent years, which makes the non-MCCA part of your auto insurance premium increase.
Michigan also recently passed Louisiana as being the most expensive auto insurance state in the nation. So the timing was good considering there will be no increase this year. However, the fact still remains that Michigan is the only state that requires guaranteed unlimited lifetime medical benefits. And regardless of whether or not the MCCA fee goes up, it's still a big problem! In fact, auto insurance has become so expensive that it's estimated that 50% of all drivers in the city of Detroit are uninsured.
Some laws and proposals are in the works as we speak. Lawmakers have said that they're wanting to overhaul the entire system. My guess is that some major changes will be made, but I can't see two parties settling on a major overhaul that they both could agree upon.
And even if a major change gets implemented, it still takes a long time before the changes go into effect. Usually when state lawmakers change insurance laws, an entire year of grace period is offered for the insurance companies to make it effective. And another six months to a year can sometimes pass before before policies renew. So even if the change happened tomorrow, it will take months if not a couple years before you see any changes happen.
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Dan Lyles is an Independent Insurance Agent serving Ohio, Indiana, Michigan, Pennsylvania, Virginia and West Virginia..