Name: DINNER & DIALOGUE CAR INSURANCE JUST FIX IT!? In Partnership With: car thefts insurance companies fraud credit zip scores codes medical costs INFORM. ENGAGE. ACT. • Introduction & Opening Clickers • Guest Speaker: AGENDA º Josh Rivera, University of Michigan Poverty May 02, 2019 Solutions • Recent Updates • Cost Drivers • Push for Solutions • Table Activities: º Focused Conversation º Trade-offs and Choices º Letter Writing ©2019 CitizenDetroit OUR PARTNERS LEAGUE OF WOMEN VOTERS OF DETROIT The League of Women Voters of Detroit is a nonpartisan political organization that encourages informed and active participation in government. The League does not endorse candidates or political parties. It influences public policy through education and advocacy. We invite you to join us as we make democracy work in our communities. lwvdetroit.org THE TAU ALPHA OMEGA CHAPTER OF ALPHA KAPPA ALPHA SORORITY, INC. On March 23, 1991, the Tau Alpha Omega Chapter of Alpha Kappa Alpha Sorority, Incorporated was chartered in Redford, Michigan. The strength of Alpha Kappa Alpha Sorority, Inc., is maintained through the ability of its Chapters to progress and remain abreast of what’s going on in our communities as well as in the workplace. Tau Alpha Omega is one of those chapters. By remaining a small, yet personable chapter, we have been effective at leveraging the talents and backgrounds of our Sorors, be they medical, educational, technological, business, or social. When talking with the first President of Tau Alpha Omega, Soror Victoria Scott, she exclaimed that one of her visions for the Chapter was that it would “evolve technologically and change with the times to meet the social needs of our communities.” Tau Alpha Omega has exceeded that vision. akatao.net THE DETROIT ALUMNAE CHAPTER OF DELTA SIGMA THETA The Delta Sigma Theta Sorority, Inc. is a private, non-profit organization founded in 1913 by 22 college women on the campus of Howard University in Washington, D.C. Deltas are committed to public service with a primary focus on the Black community and to the constructive development of its more than 200,000 members. Since 1939, Detroit Deltas have built a rich legacy of dedicated service to the metropolitan Detroit community by promoting academic excellence, encouraging community and social activism, and providing solutions to community concerns. Our work is designed to ensure that the communities we serve — and the people who live in them — thrive. In the spirit of our 22 illustrious Founders, we are committed to “Building on the Legacy of Excellence” that is based on sisterhood, scholarship and service. detroitdeltas.org 2 KEY TERMS Below are terms you will see in this workbook. CLAIM MEDICAL FEE SCHEDULE RISK A formal request by the insured Complete listing of maximum Possibility of loss to the insurance company for fees used to reimburse medical compensation or coverage for a providers for services TELEMATIC DEVICE covered loss A system that you install in your car PIP that records information about your COVERAGE Personal Injury Protection driving habits, such as the number The amount of protection provided by Insurance (PIP) of miles you drive, your speed, an insurance company and how quickly you brake. These PPI systems sometimes analyze the DIFS Property Protection Insurance (PPI) Michigan Department of Insurance time of day when you drive, as well. and Financial Services (DIFS) PREMIUM UNDERWRITING Amount paid for an insurance policy FILE AND USE (MCL 500.2119 Establishing the risk of insuring Subsection 5) A filing requirement RATING FACTORS a person and setting a premium for insurance companies. “Insurers Characteristics (about you, your car, accordingly must file their prices with the state your behavior) that insurers use to prior to use, but can start charging predict the likelihood that you will these rates without state approval. file a claim A state can later disapprove a rate NOTES: REDLINING but usually cannot require refunds The practice of discrimination if a rate is deemed to be excessive.” based on certain characteristics of (Hunter 2008) a person’s neighborhood, such as LOSS racial or ethnic makeup. Though Any injury or damage sustained by the term originated from the the insured as a consequence of discriminatory practices seen in an accident covered by insurance. the housing market, today it can Amount of compensation paid to a be used in the context of extending claimant credit or providing insurance coverage. BI/PD LIABILITY Bodily Injury/Property Damage • “Insurance redlining” is Liability (BI/PD) discrimination in the marketing, underwriting and pricing of MCCA insurance based on racial or The Michigan Catastrophic Claims ethnic characteristics of a Association (MCCA) is a private neighborhood. organization that reimburses car insurers for all PIP claims that • The use of territorial ratings as exceed $555,000, and is funded cost factors has been described by an annual fee of $192 on each as a “subtler form of redlining” car in Michigan. The fee is set to due to the higher premiums increase to $220 and the threshold to minority neighborhoods $580,000 on 7/1/19 often pay compared to white neighborhoods. CAR INSURANCE? CARWHY DOES INSURANCE CAR INSURANCE? ? 3©2019 CitizenDetroit JUST FIX IT! ©2018©2019 CitizenDetroit JUSTCOST SO FIX MUCH IT! IN DETROIT3 AUTO INSURANCE 101 Detroit is the most expensive city and Michigan is the most expensive state for car insurance in the country! The average Detroiter pays 18% of their income towards car insurance with rates around $5,000 annually, while in Chicago or Cleveland, drivers spend less than 4% of their income on car insurance. Mandatory No-Fault Insurance All vehicles are required to carry auto insurance. No Fault insurance means that your own insurance company will cover Personal Injury Protection (pay your medical bills and lost earnings if you get in a car accident), regardless of who was at fault. Michigan is the only state in the country that requires unlimited Personal Injury Protection coverage. Coverages required by law Personal Injury Protection (PIP) covers unlimited medical bills and three The Detroit Free Press years of lost wages for the INSURED person. Bodily Injury and Property Damage (BI/PD) covers medical bills and car repairs from non-resident lawsuits and residents who suffer serious injury or death Property Protection Insurance (PPI) covers repair costs for OTHERS’ PROPERTY up to $1 million Common optional coverages Collision The Detroit Free Press covers auto repairs for YOUR VEHICLE Comprehensive covers theft, vandalism, weather events, etc. to YOUR VEHICLE Uninsured Motorist covers awarded settlements against an uninsured or underinsured driver 41 RATING FACTORS: WHAT DOES MICHIGAN LAW SAY? When setting your premium, insurers are primarily concerned with how likely you are to file a claim. Rating Factors (one or more) required to be used: required to be used (MCL Also permitted by law: 500.2111): “Must be based only on one or more of the following factors, which shall be applied on a uniform basis throughout this state.” Grouping risks by territory zip code, frequently referred to as ALL INSURANCE COVERAGES red-lining 1. Age, driving experience, years 5. Vehicle characteristics, such as Senior discount plan (over 65 licensed to drive engine and safety features and drive fewer than 3,000 miles annually) 2. The primary driver of vehicle 6. Daily or weekly commuting mileage 3. Average miles driven per week 7. Number of cars insured or number and/or year of licensed operators in household Premium Discount Plan (Michigan Law 4. Type of use, such as business, 8. Amount of insurance being MCL500.2110a): THE recreation or farm purchased LOOPHOLE that PERSONAL INJURY PROTECTION COVERAGE allows any factor to be considered 1. Earned Income 3. Coordination of car insurance medi- “If uniformly applied to all its cal benefits with your health insurance insureds, an insurer may use 2. Number of dependents in- 4. Use of safety belt factors in addition to those sured permitted by section 2111 for insurance if the plan is COLLISION AND COMPREHENSIVE COVERAGE consistent with the purposes 1. Anticipated cost of car repair or replacement (age, price, cost new, value) of this act and reflects reasonably anticipated 2. Vehicle make and model reductions or increases in losses or expenses.” 3. Vehicle damageability 4. Theft prevention devices Therefore, non-driving factors such as gender and marital ALL COVERAGES EXCEPT COMPREHENSIVE status can be and are used to determine rates. 1. Completion of accident prevention education 2. At-fault accidents You can advocate to 3. Convictions for violations of vehicle code, but only as long as repeal or reform the Secretary of State carries points for that infraction ! “loophole” law ! CAR INSURANCE? WHY DOES CAR INSURANCE ? 2©2019 CitizenDetroit JUST FIX IT! ©2018 CitizenDetroit COST SO MUCH IN DETROIT5 WHY IS CAR INSURANCE SO HIGH IN DETROIT AND MICHIGAN? Car insurance is a complicated issue in Michigan, with many factors that contribute to its high cost. The federal government recognizes 2% of individual income as the level of car insurance affordability (so if you earn $30,000 per year, affordable car insurance would get $600 per year). Yet, 97% of Michigan zip codes are paying more than that. Pages 8 and 9 show the top seven cost factors that contribute to the high cost of car insurance, with possible solutions. A few general things are clear….. Credit scores and your home address dictate your price… Insurers use Car insurers often deny full credit scores and zip codes to determine how likely drivers are payment… Car insurers don’t to file a claim. These factors are always send full payment of med- treated as more important than ical costs to medical providers. a driving record and Detroiters suffer extremely high prices as We have a result.