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These days, millions of Americans may be concerned about how much they pay for all their various types of insurance coverage, and those premiums have been in the news a lot lately as a result. As such, lawmakers in various states across the country are working to help keep those costs down, including new bill being considered in the Michigan legislature with relation to auto insurance specifically. Consequently, insurance agents dealing with these types of policies in the state should take note of the law as it advances.

House Bill 5456, introduced by state Rep. Marilyn Lane, a Democrat representing Fraser, would prohibit auto insurance companies from changing anything about a consumer's policy if they have to make claims based on damage caused by potholes, according to a report from her office. Currently, policy issuers are allowed to change a person's rating classification, premiums, and surcharges if such a claim is made, irrespective of other considerations. This is especially true in Michigan, as the state has been going through some extremely difficult financial times of late, and many cities may not have it in their budgets to fix roads when needed.

The genesis of the bill
Rep. Lane noted that she only heard that such a thing could happen to drivers in the state when another lawmaker - Rep. Jon Switalski, a Warren Democrat - received a rate hike after suffering pothole damage of his own, the report said. Lane said that such things are well outside a driver's control, and therefore should have no impact on their policies.

""I was floored when my insurance company raised my rates after I submitted a claim for pothole damage,"" Switalski said. ""I'm sure that insurance companies are seeing an increase in claims because of the winter damage to our roads, but potholes are unavoidable. If we all start swerving to miss them so our rates don't increase when we submit a claim for repairs then there will be mayhem on the roads and likely far greater costs for insurers.""

In the meantime, auto insurance agents may therefore have to consider the ways in which consumers might react to such rate hikes, as they might find themselves tempted to start shopping around for more affordable coverage, or at least become dissatisfied with the policies they already have. The more that can be done to assuage such concerns, the better off agents might be while the bill is still being considered.

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