this increase is nuts; the cancellation rate/non insured in michigan is too high now – wouldn’t it be better if more drivers could afford some no-fault insurance than none at all?
George
I don’t understand your comment. The
fund (like most government run funds in the US) is already spending more than it takes in. The estimated deficit is double the current annual assessment or $2 billion.
Do you favor reducing benefits? If not, what do you suggest.
By the way, the increase is required by current Michigan law, so any changes will require legislative action.
Do you honestly believe the Michigan legislator would trim benefits?
A better question is whether the reserve is really there. Check out Wisconsin’s raiding of a similar fund covering medical malpractice.
Sue: yes we are going to have to cut this unfair “tax”:
1)If only 1200 people out of millions are starting a new claim each year that’s not a very good bet on usage for 99%?? of MI insureds – but it is expensive
2)You allow the companies to discount premiums for rates based on credit scores but there’s no discount on the assessment?
3)Why is the assessment charged for more than one vehicle if there is only one person driving in the household?
4)If it got on the ballot and was worded correctly the voters would change the law
George
I believe you are missing the main point. No matter how one restructures the indivual tax/assessment, its still not enough to cover the benefits being paid. The state will either have to cut total benefits or raise total revenues (tax or assessment). Or as governments are want to do, they “adjust” the actuarial results to balance the budget until after they are out of office. ;-)
I’ll answer your second question. The assessment is set by the state and the state will collect the full amount of the assessment from the company regardless of any discounts. The auto liability rate is also dicated by the state. Where the credit scoring discount is applied is normally on the rate charged for Comprehensive & Collision coverages.
As an alternative, perhaps they should trim back the UNLIMITED, LIFETIME benefits. That would likely do absolute wonders for the deficit in trimming it’s long term costs. Until such an unreasonable level of coverage is moderated, Michigan auto insurance purchasers really have no right to complain about the price of the assessment.
What are they thinking, with unemployment at an all time high in Michigan, now you want to increase the required auto insurance fee? It is no wonder that so many people are driving without insurance – it’s a choice food for their family or insurance – can’t blame them.
Maybe we should cut from the top and get rid of the lazy administrators and save money there instead of adding extra fees on the other end. Our Michigan taxes and insurance rates are getting out of hand. Lets help Michigan get back to work first then look at increases.
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this increase is nuts; the cancellation rate/non insured in michigan is too high now – wouldn’t it be better if more drivers could afford some no-fault insurance than none at all?
George
I don’t understand your comment. The
fund (like most government run funds in the US) is already spending more than it takes in. The estimated deficit is double the current annual assessment or $2 billion.
Do you favor reducing benefits? If not, what do you suggest.
By the way, the increase is required by current Michigan law, so any changes will require legislative action.
Do you honestly believe the Michigan legislator would trim benefits?
A better question is whether the reserve is really there. Check out Wisconsin’s raiding of a similar fund covering medical malpractice.
Sue: yes we are going to have to cut this unfair “tax”:
1)If only 1200 people out of millions are starting a new claim each year that’s not a very good bet on usage for 99%?? of MI insureds – but it is expensive
2)You allow the companies to discount premiums for rates based on credit scores but there’s no discount on the assessment?
3)Why is the assessment charged for more than one vehicle if there is only one person driving in the household?
4)If it got on the ballot and was worded correctly the voters would change the law
George
I believe you are missing the main point. No matter how one restructures the indivual tax/assessment, its still not enough to cover the benefits being paid. The state will either have to cut total benefits or raise total revenues (tax or assessment). Or as governments are want to do, they “adjust” the actuarial results to balance the budget until after they are out of office. ;-)
I’ll answer your second question. The assessment is set by the state and the state will collect the full amount of the assessment from the company regardless of any discounts. The auto liability rate is also dicated by the state. Where the credit scoring discount is applied is normally on the rate charged for Comprehensive & Collision coverages.
As an alternative, perhaps they should trim back the UNLIMITED, LIFETIME benefits. That would likely do absolute wonders for the deficit in trimming it’s long term costs. Until such an unreasonable level of coverage is moderated, Michigan auto insurance purchasers really have no right to complain about the price of the assessment.
What are they thinking, with unemployment at an all time high in Michigan, now you want to increase the required auto insurance fee? It is no wonder that so many people are driving without insurance – it’s a choice food for their family or insurance – can’t blame them.
Maybe we should cut from the top and get rid of the lazy administrators and save money there instead of adding extra fees on the other end. Our Michigan taxes and insurance rates are getting out of hand. Lets help Michigan get back to work first then look at increases.