In Michigan
5:12 pm
Mon November 30, 2009

MI Dems call for auto insurance reforms

LANSING, MI – At the state Capitol, Democrats are calling for reforms in how auto insurance rates are set. They say the goal is to reduce the number of people who are driving illegally without coverage.

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A key element of the Democrats' plans would allow insurance companies to design policies that drop all but the but the most critical coverage for low-income drivers.

Butch Hollowell is the Michigan Insurance Consumer Advocate. He says that will allow companies to sell policies that would cost no more than $600 a year.

"They're going to capture a huge portion of those who are currently driving without insurance and in Michigan, we know that's a big number - it's a third."

State law requires drivers to be insured.

Insurance executives say they're not sure Hollowell's numbers add up, although some say they're willing to test the idea. They say the real reason rates are so high in Michigan is it's the only state that has no limits on paying medical bills for injured motorists.