Michigan car insurance rates third highest in U.S.

 According to David Walker, president of Hartland Insurance Agency, Inc., Michigan is the third highest in premium costs nationwide. Louisiana and Oklahoma are the highest.

 Michigan is number one in claims payments flowing back to consumers against premiums collected. Michigan also has two of the top 10 most expensive cities for auto insurance in the United States — Detroit and Grand Rapids.

 “The primary ‘driver’ of this premium cost issue is the Personal Injury Protection section of the mandatory no-fault insurance portion of your policy,” Walker said.

 “This policy section provides for unlimited (no dollar cap) on medical benefits, loss time, physical and vocational rehabilitation and attendant care,” he added.

 If, for example, you are involved in an auto accident and are paralyzed for life, your car insurance company is required by Michigan law to pay all the medical and associated bills.

 The next most robust benefit schedule in the U.S. is New York, with a dollar cap of $50,000, said Walker. “There are a few options available to consumers but the bottom line is that this is a very expensive line of coverage and it is driven primarily by the claims,” he said.

 “There have been solutions presented to the legislature to aid in reducing the insurance costs statewide but they generally fall into one of two categories,” Walker said. “They are either areas that have a very low impact on the overall premium and thus nobody wants to spend the political capital to move them forward or they are perceived as being ‘too severe’ and cannot gain political support for much the same reason, an unwillingness to expend political capital to move them forward. If you add to this very aggressive lobbying by the hospital associations, closed head injury facilities, etc. you have gridlock.

 “I do have suggestions for an effective approach to lowering premiums but it has to be coupled with the surrendering of some benefits,” Walker said. “Absent that, the math simply does not work. The point is this. The accidents, injuries and damages don’t change based upon the insurance law that is in place. It is simply a matter of who will be paying those bills and how.”

“We certainly have a broad policy attached to Michigan no-fault insurance,” said Linda Hathaway of Brad Hoffman Insurance Agency, Inc. in Fenton. She said those who have had to use the benefit for their medical and associated bills understand and appreciate the benefit.

“Those who are fortunate enough to not have been in an accident, or had family members in an accident, the insurance rates seem high. For those who have had to walk the walk, it has been a great benefit. Other people are in denial that it could never happen to them, and I hope it never does,” she said.

 Eileen Jankowski, the personal lines manager at Brown & Brown Insurance in Fenton said Michigan is the only state with unlimited personal injury protection. “The primary reason rates in Michigan are so high is because benefits covered are so generous,” she said. “We cover all reasonable bills for medical and treatment for as long as you need it.”

 Geography and population numbers also play a role in how much you pay for car insurance, as does the number of speeding tickets a driver has been issued. Where you live and where you park your vehicle also make a difference. A car that is parked in a garage overnight is less subject to theft than one in a driveway or on the street, for example.

 Places such as Alaska and Hawaii have fewer residents and fewer people on the road, so they have fewer accidents. The fact that fewer claims are filed from those states figures in to how insurance companies calculate rates.

 The reverse is true in Louisiana. Vehicle owners there pay fairly high car insurance rates, but they also file a hefty number of injury claims. 

 According to insure.com, the average annual car insurance premium in Michigan is $2,738, followed by Montana at $2,297. Ohio and Maine have the lowest premiums at $900 and $808 respectively. The national average is $1,325.

Additional source: usatoday.com

Natural disasters and location determine homeowner insurance rates

 The national average annual cost of homeowners insurance in the United States is $1,023, but depending where you live, you could end up paying as little as $600 or over $2,000 in premiums.

 According to the Insurance Information Institute (III), the five states with the highest premiums in 2013 (the most recent data available) were:

Florida $2,115

Texas $1,837

Louisiana $1,822

Oklahoma $1,654

Mississippi $1,395

 The states with the lowest premiums include Idaho at $561, Oregon at $568, Utah at $609, Wisconsin at $665 and Washington at $676.

 When it comes to homeowner insurance, it all comes down to location.

 It mainly has to do with the weather, and how likely it is that your home will be damaged or destroyed by a natural disaster.

 For example, eight of the 10 most expensive catastrophes in U.S. history were hurricanes. And five of these have hit Florida. Because of these catastrophes, Florida residents pay twice as much for home insurance as the average homeowner. Meanwhile, out west, where hurricanes are not a factor, rates are much lower. Idaho homeowners pay almost 50 percent less than the national average.

 Although there hasn’t been a hurricane in many years, Florida’s home insurance premiums continue to increase. This is partly because companies are buying more reinsurance protection.

 Meanwhile in Texas, people face high insurance costs due to the increased chance of damage from hail, flooding, and hurricanes. Oklahoma, on the other hand, is the heart of “Tornado Alley.” Some tornadoes in Oklahoma reach the most dangerous level at F-5.

 Homeowners, regardless of what state they live in, can try to save on their insurance by shopping around, increasing their deductible and taking advantage of discounts.

Source: quotewizard.com