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- Changes to laws in Michigan in July will make car insurance cheaper by dropping a requirement for expensive unlimited personal injury protection coverage.
- Shopping around for car insurance or dropping the coverage could help Michigan drivers save at least $120 per year, per car.
- In any state, shopping around every six months or year could help you save. Car insurance laws and insurance pricing algorithms are constantly changing, and shopping around will ensure you have the best price.
- Check out our partner Savvy — a free tool that lets you compare car insurance quotes in minutes »
Car insurance in Michigan is getting a lot cheaper in July.
Michigan has historically had some of the most expensive car insurance in the US, according to the Insurance Information Institute. But, changes to state insurance laws that took effect July 1, 2020, could change that.
Each state sets its own laws on the amount of car insurance coverage required by drivers. In Michigan, a combination of no-fault accident laws and a required unlimited personal injury protection make insurance expensive, according to The Zebra. The average car insurance premium in Michigan was $1,358.62 per year in 2017, according to NAIC data, about $350 higher than the national average.
Personal injury protection, also called PIP, isn't inherently expensive. This coverage provides benefits that could help with everything from medical bills to house cleaning if you're injured in a car accident. In states like Michigan with no-fault laws, this coverage is often required. Since claims in no-fault states are always filed with your own insurer, no matter who caused the accident, it's extra protection for you.
Michigan's previous laws required companies to pay out an unlimited amount of PIP coverage, while most insurance policies and other states allow limits. Unlimited payouts meant higher costs for insurers and drivers.
Since the law changes went into effect on July 2, Michigan drivers now have the option to opt out of the unlimited coverage. The Michigan Catastrophic Claims Association says that limiting PIP on insurance policies will lower costs by at least $120 per car per year in fees alone.
In every state, shopping around could help you save
No matter where you live, you could save money by shopping around and comparing your coverage.
Not only can states change their laws, but car insurance companies are constantly changing their algorithms. These algorithms change how much companies charge for your car insurance by changing how it views your information. Your age, driving history, type of car, and even your gender can influence the price you'll pay for car insurance. For new drivers with their first-ever policy,shopping around after six months of coverage could also help lower your rate.
Shopping around periodically for your car insurance coverage can help you stay on top of those changes, and continue to get the best rate for you.
Spending about an hour gathering quotes and comparing the coverage types and limits can help you save. Look for the most coverage for the smallest premium, and you'll find the best deal. There's no one-size-fits-all insurance company or policy, so consider your individual needs when thinking about what types of coverage you need and things like your deductible, which you'll pay out of pocket if you're involved in an accident.
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