Michigan Insurance Rate Reduction Initiative (2010)
|Not on Ballot|
| This measure did not or |
will not appear on a ballot
Text of measure
In November 2009, the Board of State Canvassers voted 4-0 to approve the filed petition language. According to reports the petition's summary read:
The purpose ... is to protect consumers from unfair insurance rates and practices, to encourage a competitive insurance marketplace, to empower consumers with legal rights and to ensure that insurance is affordable for all residents.
The measure was sponsored by a group called "Fair Affordable Insurance Rates." The petition drive was officially launched on April 26, 2010 by the Alliance for the United Metropolitan Detroit. Kim Bowman, an aide to Sen. Hansen Clarke, supported the proposed measure. Gov. Jennifer Granholm also called for a 20 percent cut in insurance rates.
- According to supporters, the proposal would not have only lowered rates but "ensure that consumers are protected against unfair trade practices and to promote competitive, affordable coverage for everyone."
- Consumer Watchdog and the Consumer Federation of America argued that the ballot measure was similar to California Proposition 103 (1988), which was approved by voters. The measure, they said, "saved California drivers an average of $3 billion per year" by "creating an auto insurance market that is competitive, has low rates and protects consumers from abusive insurer practices."
- The Michigan proposed measure, they said, would have prevented "price gouging" and "require insurers to base rates primarily on a motorist's driving record rather than factors like their ZIP code or marital status."
Insurance industry representatives opposed the initiative. Representatives argued that without cutting costs the rate reductions may only cause hardships for insurers.
- Pete Kuhnmuench, executive director of the Insurance Institute of Michigan, said, "A 20 percent rate reduction puts us at risk with regard to solvency. How does any business operate with 20 percent less in income when it can’t affect the expense side? We still have the obligation to pay those claims."
- Despite arguments that the proposed measure was similar to California Proposition 103 (1988) and had proven to be a successful case, the Heartland Institute argued otherwise. "Many Californians saw their auto rates remain the same," said the institute. Additionally, the organization argued that the proposed measure's restrictions would only make it difficult for insurers to offer discounts to drivers.
Path to the ballot
- See also: Michigan signature requirements
- Consumer Watchdog,"Michigan's Proposed FAIR Initiative Modeled After Nation's Most Successful Insurance Reforms," December 1, 2009
- WWMT,"Ballot measure could give motorists the option to lower insurance premiums," November 11, 2009
- Associated Press,"Mich. ballot drive would drop insurance rates 20%," November 9, 2009
- The Detroit News,"Citizen petitions unlikely to make it onto ballot," May 27, 2010
- The Detroit News,"Ballot proposal to slash car insurance rates gains ground," November 9, 2009
- The Detroit News,"Petition drive kicks off today to reform auto insurance," April 26, 2010
- The Detroit News,"Petition OK'd for insurance cut plan," November 10, 2009
- InjuryBoard.com,"Lower Car Insurance Rates One Step Closer to Reality in Michigan," November 10, 2009
- National Underwriter,"Proposed Michigan Insurance Ballot Proposition Stirs Conflict," December 3, 2009
- Chicago Tribune,"Mich. ballot drive would drop insurance rates 20%," November 9, 2009
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