Why Michigan's high auto insurance rates are on the rise again

'You’re paying out of the top of your nose for your car insurance rates.'
Driving a Car
Posted at 2:39 AM, Jan 20, 2023

(WXYZ) — Michigan’s high auto insurance rates are on the rise again as part of a national trend that comes as inflation is also hammering our wallets.

In our state, some drivers did find savings after changes to Michigan law, but now it seems costs are climbing again.

Metro Detroit drivers say it’s enough to stop you in your tracks. Rising auto insurance rates again and questions over what can be done.

"You’re paying out of the top of your nose for your car insurance rates," said Barbara Daniels-Espey, a driver.

On a trip to gas up at 12 and Woodward in Royal Oak, drivers like Barbara and Stephanie Lajb find it hard to see the bright side of auto insurance rates.

"Every 6 months, policies go up $5-10. It’s just, what are you going to do," said Stephanie.

Barbara says, “for senior citizens it’s extremely difficult. You have to drive, eat, live.”

Living with inflation is only adding to a new report projecting U.S. car insurance rates to rise 8.4% in 2023.

That’ll make the average cost of full coverage $1,780 annually, but in Michigan, the average price is $4,788 annually — that’s despite our state leaders allowing drivers to opt out of PIP coverage in 2020 and unlimited coverage in the event of catastrophic injuries.

“In the reform passed by the Michigan legislature they got rid of that as a requirement, but as it turns out, most Michigan residents are still signing up for it," said Oakland University Economics Professor Michael Greiner.

On both sides, state lawmakers agree more can be done to make it affordable.

We asked leaders in both parties about next steps going forward.

"Cost of these plans. Making sure any guaranteed cost savings is exactly that. Guaranteed. How are we making sure auto and health care insurance are affordable and people are covered holistically?” said State Sen. Mallory McMorrow (D-Royal Oak).

State Sen. Joe Bellino (R-Monroe) says, "My message is shop around like I did. Use one of those 50 new companies that weren’t in Michigan before we changed auto no fault, you can get better rates.”

New bills are also in the works at the state capitol. In the meantime, Barbara hopes to avoid another year of seeing her bank account, and gas tank drained too quickly.

“I don’t know what the procedure should be, but if you vote for them, they ought to get together and think up a solution to the issue," said Barbara.

Our new state legislature is pledging to address this issue with real solutions. We’ll be monitoring closely to bring you the latest developments.