Mayor Mike Duggan Has Eyes Set on High Detroit Car Insurance Rates

Detroit Car Insurance Rates

Detroit car insurance rates are the highest of any city in the nation, more than double that of the next most expensive city, according to the Insurance Institute of Michigan. Mayor Mike Duggan hopes to do something about that, pushing forward a study on the feasibility of a city-owned car insurance agency.

Although the idea isn’t new, this is the first time a city mayor has made a serious commitment to make it happen. In Feb. 26 State of the City address, Duggan announced the plan, dubbed “D-Insurance.”

High Detroit Car Insurance Rates

Duggan used his own Detroit car insurance rates as an example of exorbitant pricing. When he moved to the city, his car insurance rates doubled to $6,000 a year.

“It is not justified,” said Duggan. “It doesn’t matter if you have a perfect driving record and have never been in an accident, most Detroiters are paying more for car insurance than they are for the car payment itself.”

According to David Muller of Michigan news website mLive, Michigan’s one-of-a-kind no-fault car insurance laws, which allow uncapped, lifetime coverage for those injured in car accidents, is to blame. Many attempts to create legislation that would limit coverage have been stymied.

A Revolutionary City-Owned Car Insurance Program

Muller cited House Bill 4612 as an example of when reforms for Detroit car insurance rates were blocked. House Bill 4612 would not only have helped in deterring car insurance fraud, but also intended on setting a $1 million personal injury protection cap on coverage and sought to enforce limitations on medical care costs for automotive injuries.

“When one prominent piece of legislation, House Bill 4612, was making its way to the House floor, people in wheelchairs showed up at the Capitol to protest,” wrote Muller.

City-operated car insurance programs are commonly instituted by states, but no city has done it before. Robert Detlefsen, the National Association of Mutual Insurance Companies’ Vice President of Public Policy told Simone Samano of, “We know of no other major municipality that has ever attempted to institute an insurance program of this sort.”

Photo credit: eschipul