Michigan’s No-Penalty Period for Uninsured Drivers Starts July 2

Beginning July 2, uninsured drivers in Michigan can get insurance coverage without facing penalties during an 18-month amnesty period, state insurance regulators say.

The Michigan Department of Insurance and Financial Services (DIFS) said drivers should begin seeking quotes from insurance companies or agents now for coverage under the new auto insurance law that becomes effective July 1.

“If your auto insurance coverage had lapsed for any reason, you now have the opportunity to get coverage without penalties,” DIFS Director Anita Fox said in a media release. “This is an important consumer protection for uninsured drivers who previously faced additional fees and restrictions before they could buy coverage.”

The penalties and coverage restrictions for drivers with lapsed coverage varied among insurance companies. Under the new law, insurers cannot limit coverage, charge a reinstatement fee, or increase the premium for a driver solely due to a lapse in coverage.

“Michigan had a disproportionate number of uninsured drivers, and the new auto insurance law clears many barriers to coverage that drivers were experiencing,” said Fox. “Not only are there guaranteed statewide average savings and new more affordable Personal Injury Protection coverage levels, but for the next 18 months, there are no penalties for reinstating coverage, making it the optimal time for previously uninsured drivers to obtain auto insurance that best suits their families’ needs and budgets.”

Governor Gretchen Whitmer signed bipartisan auto no-fault reform legislation to lower costs for Michigan drivers, maintain the highest coverage options in the country, and strengthen consumer protections. The changes will apply to policies issued or renewed after July 1, 2020.

Source: Michigan DIFS