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Michigan State Senators Trying to Create Insurance Program That Would Lend a Hand to Low Income Drivers

Michigan is known for having an issue with its excessively high auto insurance premium rates. There are many low income families in the United States right now due to poor economic conditions that have been brewing for the last five years or so. Michigan was known for its automobile manufacturing jobs has now seen many of its automobile plants get shipped to other states or countries leaving them for the most part high and dry. Now, the state is focusing on ways to help these individuals purchase auto insurance coverage.

Two of the state’s senators have proposed a bill that would change the way PIP insurance or personal injury protection is handled so that a driver would purchase a policy with $50,000 or $100,000 worth of coverage for medical payments. This new bill could really work in the state of Michigan. The state has a major issue with its number of unemployed residents so taking action to reduce the auto insurance premiums that drivers have to pay is a great way to help drivers to comply with the law. Being without auto insurance coverage is a huge gamble for drivers to make. It is not only illegal in most states to be without insurance coverage but it sets people up to get in a lot of trouble legally if they are in an accident while uninsured.

Other states should consider enacting a similar law because so many drivers are uninsured right now. A majority of these drivers want to obey the law and do the right thing but cannot due to their financial circumstances. By allowing drivers to choose their own amount of PIP coverage, it allows drivers to be insured while doing what is right.

It would also prevent people from taking advantage of the program. Under the new law, people would have to meet an income eligibility requirement to qualify for this type of auto insurance coverage. It is important for states to be innovative about how they address income issues when dealing with the fact that too many people are uninsured. Drivers would also have to be at least 21 and would have needed to be insured and have had a driver’s licenses for more than three consecutive years.

There are no federal programs that help drivers pay for their car insurance when times are tough which is unfair. If you lose your job and go on unemployment then your benefits barely cover your rent and food bills. Most people can get health insurance, Food Stamps, Welfare and energy assistance when their income level is too low. The United States has basically mandated auto insurance coverage in every state but yet does not help to provide low income people with ways to stay insured all the time. If a person is not insured and gets pulled over for driving without insurance then they will face fines that they cannot pay. They would also possibly have their driver’s licenses taken away which would hinder their ability to go on job interviews and become employed.

The insurance committer still needs to review the proposed bill and deliberate on it. Hopefully, the bill will pass so that drivers that have very low incomes can be insured and obey the state’s insurance laws. Poverty is a horrible thing to have to deal with. The first step to helping people rise out of poverty is to find ways however small to help them help themselves do the right thing and be able to follow the law and protect themselves from financial liabilities in the event of an accident.

Source: Property Casualty 360