Michigan auto insurers face two more years of forced PIP premium cuts under a new bill that just landed in Lansing.
House Bill 5981, introduced on May 14, 2026, by Rep. Rogers and 20 co-sponsors, would extend the state's mandatory personal injury protection premium reductions on auto policies effective before July 2, 2028. The bill was referred to the House Committee on Insurance.
Under the existing framework, auto insurers in Michigan have had to file rates producing specific average per-vehicle cuts on PIP coverage, measured against rates in effect on May 1, 2019. The required cut depends on the coverage tier the driver picks. For policies at the highest limit under section 3107c(1)(a), it's an average 45% or greater reduction per vehicle. For the next tier under 3107c(1)(b), 35% or greater. For 3107c(1)(c), 20% or greater. For policies with no coverage limit under 3107c(1)(d), 10% or greater.
The bill carries those mandates forward by setting the cutoff for affected policies at effective dates before July 2, 2028. It also requires compliance filings from insurers on policies issued or renewed in the year beginning July 1, 2024 and again in the year beginning July 1, 2026. And the rate-approval gate stays shut: between July 1, 2020 and July 2, 2028, no insurer can issue or renew an auto policy in Michigan unless its PIP rate filings have been approved under this section.
For drivers who opt out of PIP under section 3107d, or whose policies fall under the exclusion in section 3109a(2), the filings must produce no premium charge for PIP benefits payable under section 3107(1)(a).
The existing safety valve for stressed carriers stays in place. An insurer can apply to the director for approval to file at a lower reduction level, or for an exemption from the reduction requirement entirely, if hitting the mandated cut would push the insurer to the company action level risk-based capital. The bill defines that as two times the insurer's authorized control level RBC. Two other grounds for relief, based on the Fourteenth Amendment of the US Constitution and Article I, Section 17 of Michigan's 1963 constitution, remain in the statute but no longer apply after July 1, 2023.
Insurers must also pass on savings realized from the application of section 3157(2) to (14) to treatment, products, services, accommodations, or training rendered to people hurt in motor vehicle accidents that occurred before July 2, 2021. They have to hand over whatever documents and information the director needs to evaluate compliance.
The severability clause is sharp. If a court finds the core rate-reduction subsection, or its application to any insurer, invalid, the remaining portions of the amendatory act that added the section through 2019 PA 21 and 2019 PA 22 are not severable and are deemed invalid and inoperable.
For purposes of calculating the PIP premium or rate under the section, the premium must include the catastrophic claims assessment imposed under section 3104.
The bill is tie-barred. It does not take effect unless a companion Senate bill (request number S04503'25) or House Bill No. 5501 (request number H04503'25) of the 103rd Legislature is also enacted into law.
The bottom line for carriers: if HB 5981 and its companion bill clear the legislature, the PIP rate-reduction regime, and the rate-approval gate that comes with it, stays live on Michigan auto books through mid-2028, with another compliance filing round due this year.
