Michigan may have introduced reforms to its auto insurance system, allowing drivers to opt out of the state’s Personal Injury Protection (PIP) program, but unless drivers are careful with their paperwork, they may be forced to pay big premiums.
Under the new insurance rules, drivers who forego the medical part of the state’s no-fault auto insurance system have to sign additional re-certification paperwork upon renewal of their insurance.
However, those who miss the re-certification paperwork will get “surprises at renewal” in the form of larger premiums, explained State Farm branch owner David Arce, as the due date for the renewal forms draws closer.
"It's kind of catching people off guard because it feels like just yesterday we signed all those forms," Arce told FOX 2. "Depending on what the consumer did and what our customers did, there are some requirements after the fact."
Arce said that the paperwork must be signed every six months. He also cited an instance wherein one of his customers who did not sign the papers approached him, telling him that because she missed the re-certification, her insurance spiked from about $400 every six months to $950 every six months. Fortunately, that customer eventually got her papers signed and her premiums went down.
"If you renewed in August, the forms are due for February and then this coming August, customers will be asked to sign again," Arce commented.
Those opting out of the PIP portion of Michigan’s no-fault auto insurance system must be able to prove that they are already covered by another health insurance system – be it Medicare, Medicaid, or another eligible source of health insurance.