No-Fault Reforms Leave Publicís Best Interest in the Hands of Greedy Insurance Industry

Governor SnyderApril 18, 2013

LANSING – Governor Snyder today introduced his plan to overhaul the state’s no-fault automobile insurance program and allow the insurance industry to pocket billions of hidden dollars at the expense of Michigan’s most catastrophically injured people, health care providers and taxpayers. 
 
“It’s a reckless reform, ill-conceived and weighted heavily in favor of the insurance companies,” said Coalition Protecting Auto No-Fault (CPAN) President John Cornack. “It’s hard to believe the Governor had all the facts in front of him.
 
“Take a good look at this plan: is it really in the public’s best interest? I hardly think so. Capping lifetime benefits at $1 million for the catastrophically injured ultimately will shove the most vulnerable victims onto Medicaid and will pile the financial responsibility to the taxpayers.”
 
The news conference followed on the heels of a poll that indicated a majority of respondents said automobile insurance rates are too costly, though insurance companies refuse to guarantee rates will go down past the claimed $125 one-time reduction in the first year.
 
“What the research group failed to ask is, ‘Do you trust your insurance company to look out for your best interest and lower your rates?’ I hardly think so,” Cornack said. “This legislation is another example of insurance companies trying to pocket billions from those who can ill afford to foot the bill.”
 
The reforms would also close the Michigan Catastrophic Claims Association (MCCA), allowing insurance companies to pocket the leftover billions of dollars. Michigan Insurance Commissioner Kevin Clinton stated during the Governor’s press conference that any excess money in the MCCA will be distributed to consumers, if there is any left. However, section 9.08 of the MCCA’s Plan of Operation states differently, as does drafted legislation for the reforms.
 
While raking in massive profits, the insurance industry has repeatedly raised MCCA mandatory fees by hundreds of millions of dollars a year that they refuse to justify. 
 
CPAN members have said repeatedly that they favor reasonable, responsible changes to Michigan’s no-fault system – changes that would enhance the system and reduce costs, rather than tear it down. 
 
“We believe consumers would support this as well,” Cornack said “But unfortunately, that’s not what the insurance industry survey asked and that’s not what their proposals will do.” 
 
CPAN has scheduled three town hall meetings throughout the state to discuss the unintended consequences of these so-called “reforms”:
 
·         Monday, April 22, 6:30 p.m., Dearborn Heights City Hall, 6045 Fenton Ave., hosted by Rep. Phil Cavanagh;
 
·         Thursday, April 25, 9 a.m. to noon (webcast for those unable to attend in person), MPHI Interactive Learning Center, 2436 Woodlake Circle, Suite 380, Okemos;
 
·         Monday, April 29, 6:30 p.m. at the Traverse City Library, 610 Woodmere Ave.
 
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