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EXPIRING INSURANCE LAW TO DRIVE AUTO INSURANCE PREMIUMS UP

 EXPIRING INSURANCE LAW TO DRIVE AUTO INSURANCE PREMIUMS UP
 DEARBORN, Mich., Dec. 9 /PRNewswire/ -- Sixty percent of AAA Michigan auto insurance customers will see premium increases of up to 15 percent if the Legislature fails to extend key provisions of Michigan's current insurance law before scheduled adjournment Dec. 13, 1991.
 "Our outstate policyholders will be affected the most, with 95 percent of those living outside the tri-county area experiencing rate increases," said Robert A. Alkema, AAA Michigan president and CEO. "At the same time, rates will come down for 80 percent of Detroiters and for residents of many other urban areas around the state," he added.
 These wide swings in insurance rates will occur because of the re-establishment of severe rating restrictions which were set aside in 1986. These restrictions place controls on the maximum difference allowed between the highest- and lowest-rated territories in the state as well as between adjoining territories.
 The irony of the current situation was summed up by Alkema who said: "In the absence of a revised no-fault law which contains costs and cuts rates for everyone, it would be tragic if the net result of legislative efforts was a premium increase for the majority of the state's motorists."
 A joint legislative committee, meeting since summer, has been unable to come up with a plan to lower rates for all Michigan motorists. If the impasse continues, the committee has the option of avoiding rate increases by extending current law until a new plan can be developed and approved.
 "Given the urgency of this issue, the Legislature should use all available means to develop a plan which will lower costs and reduce rates for all Michigan motorists before the current legislative session ends. Failing that, they should extend existing law to allow more time for the development of such a plan," said Alkema. "I am convinced legislators will act to avoid premium increases for their constituents if they are made aware of the negative impact which the current law's expiration will have."
 -0- 12/9/91
 /CONTACT: Tom Freel of AAA Michigan, 313-336-1512/ CO: AAA Michigan ST: Michigan IN: INS AUT SU: LEG


JG -- DE004 -- 0462 12/09/91 10:25 EST
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Publication:PR Newswire
Date:Dec 9, 1991
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