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Extra Costs Coming Your Way, Michigan Motorists

By: Bridget Clerkin March 28, 2017
MI drivers will be paying more into the state's no-fault insurance plan.

Michigan may be the birthplace of the car, but instead of paying homage to the state’s rich automotive history, residents are simply being asked to pay.

Another vehicle-related rate hike went into effect in the Great Lakes State earlier this month, this one asking residents for an extra $10 per car, truck, or bus covered under Michigan’s no-fault auto insurance plan. The increase brings the total to $170 per vehicle.

While it may not seem like much, when taken together with other upticks in revenue requests made by the state this year, the numbers can start to add up—and really crunch on residents who are struggling to pay bills and get by.

On January 1, Michigan residents saw their vehicle registration fees shoot up 20%, and the state’s gas tax also saw an increase in 2017, adding 7.3 cents per each gallon of the fuel purchased there. The hikes were both made to chip away at a $1.2 billion road funding package the state passed in 2015.

Like registration fees—and, let’s face it, the gas itself—the cost of a no-fault auto insurance plan is unavoidable in Michigan. The plan is mandatory for all residents, although it does strive to extend a uniquely comprehensive amount of coverage to its benefactors.

Michigan policies will not only cover claims for all family members living under the same roof, but offers unlimited lifetime auto medical insurance benefits for injuries sustained in accidents where the policy holder was not at fault. Specifically, the no-fault fee covers claims exceeding $550,000.

An estimated escalation of those types of claims is what precipitated the increase in the fee, according to the Michigan Catastrophic Claims Association (MCCA), the organization that oversees such transactions in the state.

While $143.33 of the previous fee was going toward satisfying such claims in the past, the agency said it anticipated more than $154 of the $170 fee to go toward covering the same costs in the future.

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