LANSING, Mich. --- A new study from the Insurance Institute of Michigan concludes that the state's motorists could save as much as 21 percent on average for auto insurance if the state permitted them to buy less medical coverage than is now required.
The study concluded that part of the savings would come from limiting medical payments for injured motorists to what's now paid for workers compensation injury cases in Michigan, the Detroit Free Press reported.
The state's insurance industry is lobbying to eliminate Michigan's requirement that all motorists carry unlimited medical coverage under their no-fault auto insurance.
The study said that an auto insurance policy with a maximum $200,000 medical coverage would save an average motorist 18 percent. The study, conducted by actuary Michael Miller, also concluded that 94 percent of medical claims under the state's no-fault system cost less than $50,000. However, the cost of insuring all motorists for unlimited medical coverage has made insurance cost-prohibitive for many low-income drivers.
Michigan is the only state requiring unlimited medical coverage for no-fault auto insurance, the Detroit Free Press reported.
Originally posted on Fleet Financials