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Michigan auto insurance reform - rate change sneak peek

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MWmetalhead
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Michigan auto insurance reform - rate change sneak peek

Post by MWmetalhead » Tue Jun 02, 2020 8:57 am

Progressive and State Farm are now providing online quotes for policies starting on or after July 2. (Any policy start date prior to July 2 will be quoted using the "old" Michigan law.)

Geico isn't providing any online quotes at the moment, whereas AAA is only providing online quotes under current law (you have to call or visit an agent to receive a quote using the new law). I didn't check Allstate or Farmers given their poor reputation. I also didn't check Travelers.

Progressive grants deep - but unstated - discounts for first time customers. Last week, I ran quote via their web site using current law. It was $505 for six months for unlimited medical including attendant care, $500 collision deductible, $500 comprehensive deductible, and bodily injury per person / per accident limits of $100k / $300k, property damage coverage of $100k, and uninsured & underinsured motorist limits of $100k / $300k.

Today, their web site began offering quotes under "new" Michigan law for policies starting on or after July 2. The exact same policy was only $445 for six months.

Because I was interested only in unlimited medical and because Progressive has a bunch of deep discounts for first time customers (applicable to the initial policy term only), I felt it wouldn't be too beneficial for me to see how my premium quote would've changed had I capped my medical at $250k.

So, I went onto State Farm's web site to compare a 6-month policy with unlimited medical (and in all other respects, coverage levels identical to those stated above) to a 6-month policy where medical is capped at $250k.

State Farm's prices were as follows:
- Six month policy with unlimited medical: $946.
- Six month policy with medical capped at $250k: $750.

So, in the above example, the policy with capped medical was 20% less expensive. That is a substantial cost savings!

Also, don't forget that because I'm comparing two post-July 2 policies in the above example, the $946 policy incorporates a $50 MCCA fee whereas the $750 policy incorporates a $0 MCCA fee.

The current MCCA fee is $110 for six months. Thus, under current law, the $946 policy would be at least a $1,006 policy!

So, if we're talking a full year's worth of coverage for a theoretical two car household in my zip code, with cars of similar value to my own, and where the insured persons have an insurance score similar to my own, conceivably, the annual savings could be $1,024 per year!

Those with Medicare or employee sponsored insurance inclusive of medical care coverage for auto accidents have the ability to save even more.

The takeaway here is that the Michigan Auto Insurance Reform law appears to be functioning as intended and will indeed put considerable money back in the pockets of Michigan drivers! :)

As I've stated before, I am in favor of raising taxes reasonably - not anywhere near $0.45 per gallon - to fund repairs to our roads, especially local & county roads. If we improve our roads and bridges, insurance prices will drop even lower in the long run (and auto repair bills will also go down).


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km1125
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Re: Michigan auto insurance reform - rate change sneak peek

Post by km1125 » Tue Jun 02, 2020 10:47 am

That's encouraging. I need to do some similar homework, as my policy expires this month.



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Re: Michigan auto insurance reform - rate change sneak peek

Post by Vic Doucette » Tue Jun 02, 2020 10:56 am

My wife has worked in the IT department of a major auto insurance company for better than 2 decades. She's up to her eyebrows in readying the company for the new law. Compounding the issue is the ancient technology the programs were originally written in. She's been doing this sort of stuff for 40 years and is one of the very few people there who has experience with programs that were state of the art in 1974.


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Re: Michigan auto insurance reform - rate change sneak peek

Post by MWmetalhead » Tue Jun 02, 2020 8:25 pm

AAA sent me a quote (unsolicited) for a post-July 2 policy, six month term, of $388! The catch is the PIP coverage was only $250k with no provision for attendant care.

For those willing to "risk it," that is a great price.


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Re: Michigan auto insurance reform - rate change sneak peek

Post by Rate This » Tue Jun 02, 2020 8:46 pm

MWmetalhead wrote:
Tue Jun 02, 2020 8:25 pm
AAA sent me a quote (unsolicited) for a post-July 2 policy, six month term, of $388! The catch is the PIP coverage was only $250k with no provision for attendant care.

For those willing to "risk it," that is a great price.
So the by the month price is 388 divided by 6 correct?



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Re: Michigan auto insurance reform - rate change sneak peek

Post by MWmetalhead » Tue Jun 02, 2020 8:59 pm

You would add $19 to the $388 price and divide by 6 to get the monthly price.

Bear in mind prices will vary widely based on vehicle, driving record, zip code, and especially credit score.


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Re: Michigan auto insurance reform - rate change sneak peek

Post by Rate This » Tue Jun 02, 2020 9:46 pm

MWmetalhead wrote:
Tue Jun 02, 2020 8:59 pm
You would add $19 to the $388 price and divide by 6 to get the monthly price.

Bear in mind prices will vary widely based on vehicle, driving record, zip code, and especially credit score.
Gotcha thanks... that still sounds like an incredible savings...



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MWmetalhead
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Re: Michigan auto insurance reform - rate change sneak peek

Post by MWmetalhead » Wed Jun 03, 2020 7:21 pm

AAA and Progressive seem to have competitive pricing.

Geico has a reputation for low prices, but I did not receive a quote from them for the reasons stated earlier.

No one should waste their time with State Farm.

Liberty Mutual, my current insurer, also is a joke when it comes to pricing. I mainly went with them a year ago because of their competitvely priced homeowners insurance. They initially provided what seemed like a reasonable auto quote, but after the policy started, they jacked up my premium by $300 due to a speeding ticket from four years earlier. The terms of their safe driver program were also deceptively communicated. Some of my original participation discount was clawed back despite having an overall score of "good" during the 90 day monitoring period. I will be cancelling my auto policy with them effective July 2.


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TheForce
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Re: Michigan auto insurance reform - rate change sneak peek

Post by TheForce » Wed Jun 03, 2020 10:10 pm

I've been with Progressive for about 10 years. I pay monthly so there are fees associated with doing that. I just got a renewal notice today. If I pay the 6 months in full it's $554. Paying in full would save $70. I haven't really looked into the new coverage options that take effect in July. Something I will have to think on. Michigan's auto rates are excessive in comparison to neighboring states.



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Re: Michigan auto insurance reform - rate change sneak peek

Post by Vic Doucette » Thu Jun 04, 2020 8:15 am

A repost from May 2019:

We were with the same large insurance company for at least 25 years and perhaps longer. I dutifully paid the premiums each month as they crept higher and higher.

A billing problem popped up a few months back that nobody could solve -- the agent blamed the company and vice versa. I got tired of all the phone calls I was making to try to straighten things out and decided to look into other options.

Imagine my shock when I learned that I could get equivalent coverage from another large company for our house and its contents, two vehicles and a million-dollar umbrella policy for a thousand dollars less than I had been paying! I guess that first company wasn't such a good neighbor after all.

Insurance companies are like cable companies; they penalize loyalty rather than rewarding it. I will never again go more than a year without reviewing our insurance coverage.


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NewzKiller
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Re: Michigan auto insurance reform - rate change sneak peek

Post by NewzKiller » Thu Jun 04, 2020 9:00 am

It's going to be a mess. I talked with my agent back in February and not surprisingly he said the insurance law was done in haste. There's a reason why more lawyers ad's are showing up in several media.



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Re: Michigan auto insurance reform - rate change sneak peek

Post by Vic Doucette » Thu Jun 04, 2020 9:31 am

NewzKiller wrote:
Thu Jun 04, 2020 9:00 am
It's going to be a mess. I talked with my agent back in February and not surprisingly he said the insurance law was done in haste. There's a reason why more lawyers ad's are showing up in several media.
Agreed. My wife (see an earlier post) says trying to institute the needed changes is a complete clusterfuck. She says the company will be fortunate if the changes can be made correctly and on time.


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Re: Michigan auto insurance reform - rate change sneak peek

Post by bugzapper » Thu Jun 04, 2020 10:43 am

Does anyone know how Medicare factors into all of this? Thanks.



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Re: Michigan auto insurance reform - rate change sneak peek

Post by MWmetalhead » Fri Jun 05, 2020 4:58 pm

If you have Medicare Plan A or B, you are entitled to $250,000 of personal injury protection coverage for free.

If you want unlimited PIP coverage, you'll have to pay for it just like now (although premium will be less than under current law).


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Re: Michigan auto insurance reform - rate change sneak peek

Post by TheForce » Sun Jun 07, 2020 7:44 am

What about medicaid recipients? Also I got an e-mail from Progressive and got a $16.40 refund, not much really. I paid off my Cruze in January and I'm looking to cut costs. With Michigan having unlimited PIP coverage, what level of PIP coverage do the surrounding states require? I've always heard insurance is much cheaper across the state line.
MWmetalhead wrote:
Fri Jun 05, 2020 4:58 pm
If you have Medicare Plan A or B, you are entitled to $250,000 of personal injury protection coverage for free.

If you want unlimited PIP coverage, you'll have to pay for it just like now (although premium will be less than under current law).



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