Women In Michigan Pay More For Auto Insurance

It's 2017 but women still can't win for losing. On top of consumer pricing bias such as Pink Tax and gender based wage gap, women in Michigan are faced with another issue - paying more for auto insurance.

Independent insurance expert Doug Heller, the same Doug Heller who shockingly revealed in August that low wage Michiganders pay more in auto insurance than their more affluent counterparts, conducted a new study into insurance gender prejudice. Heller produced the survey under the Coalition Protecting Auto No-Fault (CPAN) by collecting around 100 online premium quotes and comparing women and men with the same factors such as addresses, mileage, vehicles, and driving record, within the cities of Brighton, Michigan and Detroit, Michigan.

In the end, 3 insurance companies were shown to be biased when it came to premiums between the sexes. The medal for most prejudiced goes to Progressive, for charging women 38% more than men with the same demographics. Esurance comes in a close second charging woman 33% more than men. In another kind of bias Liberty Mutual charged both sexes 5% more if they were widowed. Heller’s survey showed that in general, if women happened to be single or widowed, they were charged 5% to 10% more than women who are married. 

In response to the survey's findings, the 3 insurance companies replied to Channel 7 News as follows:

Progressive commented, “Our rating factors are actuarially justified and in compliance with all state laws and applicable insurance statutes.” Liberty Mutual opted for the route of assurance stating that one of their principles is treating everyone equally, without discrimination, and embracing an inclusive environment for all. Esurance really didn’t offer a statement, just a suggestion that those inquiring answers should look to the Insurance Alliance of Michigan (IAM).

Illegal Auto Insurance Pricing

Despite the auto insurance companies stating that their pricing difference based on sex is within the law, CPAN alleges that this very act is very much illegal according to Michigan’s Insurance Code of 1956. In section 4 it clearly states, “An insurer shall not establish or maintain rates or rating classifications for automobile insurance based on sex or marital status."

Heller argued, “When insurance companies are allowed to slice, dice, and price Michiganders according to personal characteristics that have nothing to do with their driving, many good drivers end up paying more than they should or driving uninsured, and it's one of the reasons premiums are so high in Michigan.”

It almost seems like fighting with auto insurance companies is like battling tobacco companies back in the 1950s. It’s no wonder why so many people are distrusting of insurance agencies today. With Michigan’s No-Fault under scrutiny, one can hope and act through their political representatives to make sure that biases such as this are no longer permitted by auto insurance agencies. A few rotten apples shouldn’t spoil the bunch.

One step forward, ten steps back seems to be the song and dance women have been enduring when it comes earning equality among the sexes. Even though data collected by the Insurance Institute for Highway Safety shows that men are more likely to engage in risky driving habits, drink while driving, and more likely to be involved in fatal car accidents, women are still unfairly charged more for insurance. If you or a loved one has been involved in an auto accident, call 844.4MI.FIRM for a free consultation with an experienced attorney at The Michigan Law Firm, PLLC, today. We are here to help you!

Michigan House Eliminated $80 Million Tax Credit to Insurance Companies

Back in May 2016, the Michigan House of Representatives approved a measure which would eliminate an $80 million tax credit accidentally awarded to auto insurers. The elimination of this tax credit would be a major boost for the current and future state budgets, which have been impacted by lower than expected state revenue lawmakers told MLive. According to the latest estimates, state revenues are projected to be $174 million lower than expected this fiscal year and $159 million lower in 2017.  

The notable drop in revenues for the state was the deciding factor that really brought the proposal of eliminating the tax credit to the forefront. “I think this creates a real incentive for folks to understand we just can’t have a corporate 80 million handout giveaway. And that needs to get fixed. So I think it puts a little more urgency on that,” House Appropriations Chairman Al Pscholka said. 

“It’s not retroactive, so it doesn’t take the money back, but they (auto insurers) can’t claim the credit in this year,” Gideon D’Assandro, spokesman for House Speaker Kevin Cotter said. The problem first began in the 2011-2012 legislative session, when the House approved what came to basically be an administrative charge for the Michigan Assigned Claims Plan. MLive reports that it was reassigned from the Secretary of State to the Michigan Automobile Insurance Placement Facility, which then opened a tax credit worth somewhere around $60-80 million for insurance companies. 

Representative Jim Townsend, a Democrat from Royal Oak believes that the tax credit aided auto insurers and at the same time hurt middle class families. “Passing these bills shows that Republicans are listening to our message of tax fairness, and understanding that we need to help the working families who are carrying an increasing share of the state’s tax burden,” Townsend said in a statement. 

Insurance companies can be tricky and it can be difficult to face them alone. If you or somebody you know has been involved in an accident and has been having a difficult time getting help from your insurance company, call The Michigan Law Firm, PLLC. Our attorneys are experienced in working with insurance companies in order to get our clients the best help available. Call us today, at 844.4MI.FIRM for a free consultation. 

Lowering Michigan Auto Insurance Rates

According to a study by Insure.com, Michiganders pay on average, a rate of $2,520 for their car insurance, because of the Michigan no-fault system. This premium covers the cost of personal injury protection (PIP) benefits for the policy holder. In other words, the driver's insurance company covers the cost of all medical bills in the case that the policyholder and in certain circumstances, the passengers in the car are injured in a motor vehicle accident regardless of fault.

Michigan Car Insurance

People often ask is there a way to obtain cheaper auto insurance or is there a way to lower car insurance premiums.  The answer may lie in recent technological developments in the auto industry - self driving cars. 

If humans were not actively controlling motor vehicles, thus removing the number one cause of car crashes, human error, many say the amount of annual car crashes  will be significantly reduced.

In a recent study involving 1,500 new car owners, The Boston Consulting Group found that 44% of people surveyed would buy a fully autonomous car. The top three reason that they stated for buying a self-driving care were increased safety, lower car insurance premiums, and the allowance of productivity and multitasking while the car drives them around. 

If cars are made to drive themselves, and drive themselves so safely as to allow the passengers to watch TV or sleep while the car is in motion, perhaps it is likely that because of the new safety features, car crashes will be less frequent. 

Until self-driving cars are further developed, tested, and integrated into the Michigan laws,  , people will be required to drive their own cars and brave the dangerous Michigan roads and risk car accidents.

If you have been injured in a motor vehicle accident, call The Michigan Law Firm, PLLC. Our experienced auto accident team helps victims of car accidents receive the medical benefits they are entitled to and makes sure that car insurance claims are paid. . Auto accident attorneys are standing by to speak with you regarding your Michigan auto accident questions. Call us at 844.4MI.FIRM.

Cheaper Auto Insurance For Michigan Drivers

In the State of Michigan, all auto insurance companies are required to pay an assessment of $186 every year, for each policyholder, in payment for Personal Injury Protection (PIP) benefits.  This cost is typically passed on to the consumer, Michigan drivers. 

As stated directly by the MCCA:

Michigan's unique auto insurance no-fault law provides unlimited lifetime coverage for medical expenses which result from auto accidents. The MCCA reimburses auto no-fault insurance companies for each Personal Injury Protection (PIP) medical claim paid in excess of a set amount. Currently that amount is $530,000. That means that the insurance company pays the entire claim, but is reimbursed by the MCCA for medical costs over $530,000.

On March 25, 2015, the MCCA announced that the assessment would be dropping to $150, in turn, likely making car insurance cheaper for Michigan residents.  This change takes effect July 1st, 2015 and will last for one year. 

In 2014, the MCCA “paid out $1 billion, mostly for brain and spinal cord injuries, multiple fractures, and back and neck injuries.” In 2015, the MCCA hopes to use $4.50 of assessed $150 to balance a deficit of $292 million for existing claims. “$145.10 will cover anticipated new claims.”

PIP benefits include the cost of medical treatment, wage loss, attendant care, and replacement services.

The Michigan Law Firm, PLLC helps people injured in car crashes to open insurance claims and to identify and receive these PIP benefits. Call our experienced team at 844.4MI.FIRM or click here for a free consultation.  

 

Sources:

Michigan Catastrophic Claims Association

Detroit Free Press

Michigan Radio