Michigan Senate Bill SB0709

Michigan 2023-2024 Regular Session

• Introduced: 2/7/24
• Refer: 2/7/24
• Report Pass: 2/14/24
• Engrossed: 2/14/24
• Refer: 2/14/24
• Report Pass: 11/14/24

Caption

Insurance: no-fault; penalties for lapse of insurance policy; provide waiver for certain individuals. Amends sec. 2118 of 1956 PA 218 (MCL 500.2118). TIE BAR WITH: SB 0282'23

Impact

The implications of SB 709 are significant as it requires insurers to adhere strictly to the established underwriting guidelines. Insurers must now base their underwriting rules solely on predetermined criteria related to an applicant’s driving history, vehicle type, and insurance history. The bill discourages arbitrary decisions by insurers that may lead to discrimination against certain individuals based on their insurance history or vehicle modifications. Consequently, this could lead to improved access to affordable automobile insurance for consumers, promoting a more equitable marketplace.

Summary

Senate Bill 709 amends the Michigan Insurance Code, specifically section 2118 of 1956 PA 218. The key intent behind this bill is to provide clear stipulations around automobile insurance coverage, particularly regarding the refusal to insure or the limitation of coverage based on the underwriting rules. It seeks to ensure that eligible individuals cannot be denied insurance or have their coverage limited without consistent and fair criteria outlined in the regulation. This amendment aims to bolster the rights of consumers in the automobile insurance market by mandating transparency and fairness from insurance providers.

Sentiment

General sentiment surrounding SB 709 appears favorable among consumer advocacy groups who view it as a necessary step toward protecting drivers. Supporters argue that the bill fosters greater accountability and fairness among insurance providers, essentially aiming to reduce instances of unjust denial of coverage. However, there may be concerns from the insurance industry about potential increased liabilities and compliance costs associated with maintaining or adding to underwriting practices. The balance of interests between consumers and insurers will be carefully watched as the bill progresses.

Contention

One notable point of contention during discussions of SB 709 relates to whether the underwriting rules adequately protect both consumers and the insurance providers. While consumer advocates champion the bill for enhancing fairness and transparency, some insurance representatives assert that overly strict regulations could limit their ability to manage risk effectively. Additionally, the bill ties its effectiveness to the enactment of other related bills, which adds a layer of complexity and potential delay in its ultimate implementation.