Will a change in law mean cheaper state car insurance?

April 27--Michigan drivers aren't just dodging potholes; they're also combating the nation's most expensive car insurance, according to the latest report.

Michigan drivers pay 136% above, or more than double, the national average of $815 a year, according to a report by insuranceQuotes.com.

And Wayne County is the most expensive county within the most expensive state. Car insurance costs $2,789, or 45% more in Wayne County than the statewide average of $1,923, according to a report by insuranceQuotes.com.

Sky-high auto insurance rates aren't anything new to Michigan consumers.

But the report might add fuel to the argument that the state can no longer afford top-of-the-line coverage.

The state's lawmakers currently are debating a fast-track, potential overhaul of Michigan's no-fault auto insurance system. Some expect that major reform to Michigan's system could move toward final passage as early as this week.

The legislation would create a new version of the Michigan Catastrophic Claims Association but keep Michigan's unique system of unlimited benefits for those who suffer serious crash injuries costing more than $545,000.

But the legislation calls for other limits or caps. For example, rates for home health care providers would be capped at $15 per hour for family members unless they were trained health care professionals. For more specialized care, higher amounts could be allowed.

Unlike the Senate plan, the House version mandates that insurance companies reduce auto insurance rates by $100 per vehicle for two years.

The insuranceQuotes.com survey is part of a regular report tracked by the company and not released as part of the Michigan debate.

Rhode Island is the second-most expensive state, but it is 45% more than the national average and significantly lower than Michigan.

Other expensive states: New York, Delaware, and Louisiana.

The cheapest car insurance? North Carolina, according to the report by insuranceQuotes.com. North Carolina drivers pay 41% less than the national average. Other low cost states: Idaho, Ohio, Maine, Wisconsin and Tennessee.

Laura Adams, senior insurance analyst for insuranceQuotes.com, noted Michigan is the only state where car insurance includes unlimited lifetime personal injury protection. That's a major reason why car insurance is so expensive in Michigan.

Another source of high premiums: Michigan has an unusually high number of uninsured drivers, which drives up rates for people who do have car insurance, she said.

Adams said the discussion in Lansing regarding capping some medical expenses in Michigan could lead to lower rates. She expects that changes would need to be made gradually.

She noted that Michigan is coming to a critical point where the auto insurance system needs to be reviewed, given the high costs.

"Michigan is by far the most generous in terms of what they're offering policyholders in the state," Adams said.

Contact Susan Tompor: 313-222-8876 or [email protected].

Tips for saving money now

Consumers who want to save money on car insurance can benefit by shopping around and considering some tips:

* Be extra careful about auto insurance offers that look too good to be true. The Michigan Department of Insurance and Financial Services has taken action to suspend licenses of various insurance agents, most recently the Affordable Insurance Agency III Inc. in Clinton Township. In such cases, the state regulator charged that agents were selling fraudulent Michigan certificates of no-fault auto insurance, keeping the money, and leaving customers without coverage. Consumers can file complaints or ask questions at DIFS at 877-999-6442.

* Take extra care to avoid tickets, especially if you're a young adult driver. Drivers ages 18 to 49 years-old are three times more likely to see their insurance premiums rise after receiving a ticket than drivers in the 50-to-64 year-old age group, according to another survey by insuranceQuotes.com. Many times, insurance carriers check a young driver's record every six months but won't regularly check an older driver's record, according to Laura Adams, of insuranceQuotes.com. The reason? The record checks can be costly and older drivers are typically considered to be safer drivers.

* Make sure you update your vehicle registration, license plates and any state inspections. Letting one of these expire can draw more attention from law enforcement, according to insuranceQuotes.com. Those who commit several smaller violations can be more likely to face higher car insurance costs.

* Driving under the influence of drugs or alcohol, reckless driving and leaving the scene of an accident almost always result in higher car insurance premiums.

* Ask an insurer if there are any discounts if you belong to a college alumni group, fraternity, sorority, professional group or credit union. Some discounts apply if you work for a major company, too.

* Look at options for increasing your deductibles, if you could handle higher out-of-pocket costs in the case of an accident. Check into deductible options for collision and comprehensive coverage.

* Take the cost of car insurance into account for specific makes and models when shopping for a new car. Some experts say better insurance rates can be found on minivans and SUVs because those vehicles tend to be driven by cautious parents.

Interactive maps

County-by-county Michigan map:

http://www.insurancequotes.com/auto/michigan-auto-insurance-quotes

State-by-state national map:

http://www.insurancequotes.com/auto/location-and-auto-insurance-rates-42215#anchor

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