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Michigan Auto Insurance Industry Says “Trust Us”, But Lawmakers Demand To See Facts

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Over the last two and a half months, I have been writing about the Michigan auto insurance industry’s well-funded attempt to back out of its 40-year-old promise to pay unlimited lifetime medical benefits for people injured in auto accidents. The industry claims the current system of No-Fault benefits is bankrupting insurance companies and Michigan’s Catastrophic Claims Association (MCCA), but some of our legislators are asking for hard facts to back up this assertion. This seems to have taken the auto insurance industry by surprise – apparently they had hoped lawmakers would be satisfied with a simple “trust us” before agreeing to a wholesale revision of a system that has worked well since 1973.

Amazingly, the industry is still reluctant to make the requested information available. For years, Democratic representatives have been crying out for more transparency – the MCCA is funded with the public’s money in the form of a statutory assessment included with the insurance premium – but the industry has refused to make the information available.

Why not?

Because, according to Insurance Commissioner Kevin Clinton, the information is too complex for legislators and the public to understand.

In addition to Clinton’s apparent belief that Michigan residents are not very smart, there is reason to question whose side he is on. Today he is the Insurance Commissioner, but his last job was as President and CEO of A.P. Capital, a huge insurance company recently acquired by The Doctor’s Company (which has $4 billion in assets) to form an even larger insurance company, where he made millions of dollars.

The auto insurance industry, in spite of their track record, says “Trust us.” What should we say back?