Michigan’s Department of Insurance and Financial Services (DIFS) insists that the state’s 2019 auto no-fault reform reduced car insurance rates and decreased the number of uninsured drivers. However, newly released data shows these claims are inaccurate.
Insurance Rates Have Actually Increased Nearly $200 Since 2019
A report from consulting firm Milliman reveals that average auto insurance rates in Michigan rose by almost $200 between 2019 and 2024, contradicting DIFS’ public statements.
In its December 2 press release, DIFS also claimed the reform lowered the percentage of uninsured drivers. But according to the report, the number of uninsured drivers is now higher than before the law was enacted.
PIP Savings Were Wiped Out by Significant Premium Increases
The Milliman report—commissioned by DIFS at the request of the Michigan Legislature—estimates that drivers saved an average of $357 per year, primarily from reduced Personal Injury Protection (PIP) premiums.
PIP covers medical expenses for drivers and passengers injured in a crash. However, these savings were overshadowed by double-digit premium increases approved by DIFS in the years following the reform. While insurance costs briefly dipped after the 2019 law passed, rates soon climbed again, making 2024 the most expensive year included in the analysis.
Savings Figures Based on Assumptions, Not Direct Comparisons
To calculate its estimated savings, Milliman relied on several assumptions about what insurance rates might have looked like if the no-fault law had never been implemented.
The report notes:
“It is not possible to accurately measure the effects of the no-fault law by simply comparing average pre- and post-reform premiums, because the reform period was heavily impacted by the COVID-19 pandemic.”
Consumer Advocate Calls the State’s Messaging ‘Gaslighting’
Doug Heller, a car insurance expert with the Consumer Federation of America, criticized DIFS’ statements as misleading.
“When you have to make adjustments based on assumptions to prove your points, you might not have a good point,” he said.
He added that Michigan residents can clearly see the truth in their rising insurance bills:
“It looks like the state is either trying to protect insurance companies or is embarrassed and trying to cover up its own failure to deliver the promised reforms.”
DIFS Doubles Down Despite Conflicting Data
When contacted by Michigan Public for comment, a DIFS spokesperson repeated the agency’s claims:
“For 2024, Michigan drivers saw an average savings of $357 per vehicle. The Milliman report states that the reform decreased the uninsured rate.”
However, the report’s data shows the opposite: Michigan’s uninsured driver rate has increased since the law was enacted. What actually decreased was the gap between Michigan’s uninsured rate and the national average—not the rate itself.
Catastrophically Injured Patients Continue to Suffer Under the Law
The report also examined the reform’s impact on severely injured crash victims. The 2019 law drastically cut reimbursement rates for home care providers treating catastrophically injured individuals.
Due to data limitations, the report could not draw firm conclusions. Nevertheless, Milliman estimated that 3,949 crash victims per year in Michigan will exhaust their medical coverage under current insurance policies.
Tom Judd, Executive Director of the Michigan Brain Injury Provider Council, said:
“This report paints a devastatingly incomplete picture of the state’s landscape for anyone who needs care following a catastrophic accident. The no-fault law has created significant barriers to care for the most vulnerable and severely injured people.”
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