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PCI: Bills Single Out Insurers, Threaten to Worsen Michigan's Woes

Source: PCI

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Posted on 14 Jul 2009

A package of insurance bills being considered in the Michigan legislature unfairly attacks an industry that provides thousands of jobs and could create negative consequences for Michigan consumers already struggling under the state's worsening economic conditions, according to the Property Casualty Insurers Association of America (PCI).

HB 4144 through HB 5151—in addition to previously filed bills HB 4244, HB 4844, and HB 484—deal with unfair trade practices and 'bad faith' claims handling. However, laws already exist that govern claims handling.

“Michigan’s insurance regulator already has the power the check into claims handling,” said Ann Weber, PCI vice president, regional manager and counsel. “This group of bills unnecessarily singles out insurers and places excessive restrictions on a stable industry that employs thousands of people in the state. Considering the state of Michigan’s economy and its high unemployment rate, this legislation seems particularly ill-conceived.”

Similar legislation has been defeated in other states when lawmakers learn about the duplicative nature of the proposals and potential for negative consequence.

“Excessive ‘bad faith’ legislation clogs courtrooms with frivolous lawsuits, hinders insurers’ ability to fight fraud and drives up insurance costs,” said Weber. “These bills would create an extraordinarily harsh environment for the insurance industry. Michigan cannot afford to alienate responsible businesses that are providing jobs and working hard to serve their policyholders in the state.”


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