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In recent years, the size of the impact that auto insurance fraud has on rates for all drivers has come into sharper focus for many lawmakers and regulators, and as such, they are now making greater efforts to curtail this kind of crime. That's certainly the case in Michigan, where legislators are hustling a reform bill through the Senate to help stamp out fraud and bring more certainty to a state where rates are already among the highest in the nation. Meanwhile, insurance agents might likewise want to do a little more to help people understand the kind of impact insurance fraud has on their personal policies, and what they may be able to do to reduce their liabilities in other ways.

The Michigan Senate Insurance Committee recently voted to pass a bill that would change the state's controversial auto insurance law to absolve insurers of liabilities related to auto insurance fraud, the report said. But at the same time, the state would ensure that people injured in accidents will still get access to unlimited health care. Essentially, this bill is designed to make sure that people aren't milking the state's catastrophic claims laws for more care than they need, which can add significant costs to insurers.

Potential opposition
However, while many (including the auto insurance industry) support the law, at the same time, some critics have raised concerns about just how quickly it's moving through the legislature, the report said. At issue is the fact that it was drafted and passed on to the Senate so quickly that many lawmakers might not have been able to read the legislation in its entirety so that they can make the most informed decision about whether this is actually good for consumers.

The fact of the matter is that many consumers don't realize how widespread the problem of auto insurance fraud is, nor how much it can impact the cost of their own coverage, even if they haven't been involved in it or personally affected by it in any way. But if insurance agents can highlight the damage done in this regard, it might go a long way toward helping people more fully understand their coverage. That, likewise, could lead to them feeling better about their relationship with their insurer or agent, and boost retention and customer satisfaction rates.

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