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Car insurance fee falling to $100 a vehicle

LANSING (AP) — Michigan drivers who want unlimited medical coverage for crash injuries will pay $100 per vehicle starting in July, which will be 55% less than the record-high $220 annual fee they currently pay.

The Michigan Catastrophic Claims Association, a state-created nonprofit entity that reimburses auto insurers for health care claims surpassing $580,000, announced the cut Wednesday. The move came roughly five months after the passage of a law making the mandatory fee optional beginning next summer, as part of a plan to lower rates in a state with the countryís most expensive average premiums.

Motorists who forego personal protection benefits entirely — they can do so if they have Medicare or separate health insurance that covers car crash-related injuries — and those who choose less coverage will avoid the assessment altogether, said MCCA executive director Kevin Clinton.

The $100 fee will be the lowest in 17 years. The portion of the fee that covers a fund deficit, $43, will fall to $0 because the deficit has been eliminated, he said. The total fee was $100.20 in 2003-04.

ì“Today’s reduction by the MCCA demonstrates that our historic bipartisan legislation will provide real savings to Michigan drivers,î” Democratic Gov. Gretchen Whitmer said in a written statement.

The insurance industry, whose members sit on the MCCA board, said the steep fee decrease is proof that the changes signed into law will work.

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