Citizens Study: Consumers Open to Auto Reform Options, Uncertain About Process

Two-Thirds of Survey Respondents to Rely on Advice of Independent Insurance Agents

Citizens Insurance Company of America, a leading provider of property and casualty insurance for individuals and families in Michigan, announced the findings of a research study it conducted on Michigan consumers’ and independent agents’  expectations regarding no-fault auto insurance reform.

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Citizens partnered with Zeldis Research Associates to survey 300 consumers in Michigan at the end of 2019. The survey explored consumer response to reform, how much consumers knew about the new law, and what actions they might take as a result.

The key findings of the research include:

• Consumers are open to making a change. 70% of respondents said they plan to switch from unlimited personal injury protection (PIP) to another level of protection. When making their choices, 60% of consumers will weigh coverage and price equally.
• Consumers are uncertain about auto reform. 60% of consumers are unsure when key aspects of reform take effect; 62% of respondents are unsure whether a driver who ca`uses an accident can be sued; and 65% of consumers are unsure whether non-resident insureds are still covered.
• Consumers value the help and support of an independent agent. Two-thirds of consumers said they have or will seek help regarding reform from an independent agent. Nearly 60% of respondents said independent agents are the most trusted source for information about reform.

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“Until this year, Michigan has required drivers to pay for unlimited, lifetime PIP coverage, which far exceeds the PIP coverage required by any other state and contributes to our highest-in-the-nation auto insurance costs,”  said Paul J. Mueller, senior vice president at Citizens. “Finally, auto reform will provide Michigan residents with choice and enable them to work with their independent agents to buy the appropriate level of coverage.”

Citizens is prepared to help its agent partners and customers navigate the complexities of no-fault auto reform. As one of Michigan’s top 10 personal insurance providers, Citizens insures nearly 450,000 vehicles in the state. Citizens is using its expertise in Michigan to partner with agents and recommends that consumers:

• Consider all the options that will be available. Michigan residents will be able to choose from several PIP coverage choices. It’s important to balance cost savings with coverage options. For example, according to the Insurance Research Council, 99% of Michigan PIP claims are below the new $500,000 PIP coverage option.
• Round out coverage. Now is the time to assess your total insurance package, including umbrella and bodily injury limits. Be sure to look at all of your coverages and see if there are any gaps to consider. For example, there are many benefits to bundling home and auto policies together with one carrier.
• Seek the counsel of an experienced independent agent. These professionals are uniquely qualified to help Michigan consumers navigate reform and all of the available choices. As trusted advisors, independent agents can assess coverage needs and make recommendations that are tailored to you and your family.

Citizens recently received approval on its rate filing from the Michigan Department of Insurance and Financial Services, a critical step to being able to do business in the new reform environment. The company also just announced it will return 15% of April and May auto premiums to its eligible personal lines customers, pending regulatory approval, providing financial relief during the coronavirus pandemic.

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