Michigan has the highest car insurance rates in the United States, and it’s about to become even more expensive to own and operate a car. In 2017, there will be several new road-funding bills coming into effect, which will raise the cost of registration and increase the gas tax.
As required by law, all Michigan drivers have no-fault car insurance. This insurance has great benefits, but it isn’t cheap. According to a 24/7 Wall Street Study, Michigan is the most expensive state for car ownership when considering gas costs, maintenance costs, and insurance premiums. Much of this money goes toward maintaining and improving the state’s roads, but new road projects are about to make these costs even higher.
In the fall of 2016, many drivers saw their car insurance rates increase after the state government got rid of a tax credit that had previously been given to insurance companies. Michigan residents can also expect a 20 percent increase in vehicle registration fees as well as a 7.3 cent gas tax increase. Before the increase, Michigan’s gasoline tax was 19 cents per gallon. The road-funding project, which was signed by Governor Rick Snyder back in 2015, will require an estimated 1.2 billion dollars.
Drivers with electric and hybrid vehicles should expect to pay even more. Electric vehicle owners will have to pay a $100 surcharge and a $35 gasoline tax. Hybrid vehicle owners will be required to pay a $17 gasoline tax as well as a $30 surcharge in addition to normal vehicle registration fees. Although the increase in costs is inconvenient, many drivers understand why they’ll have to pay more. Justin Kreager, a Michigan resident, says, “It’s a privilege to drive, so I guess the fees are okay, but it is kind of a hassle to get $100 every single time.”
Fortunately, drivers in Michigan will have better roads and bridges after the road-funding project has been completed. The money will be split among all types of roads in the state, with 39 percent of the funds going to state roads, 39 percent of the funds going to country roads, and 22 percent of the funds going to city and village roads. Michigan residents are hopeful that the increase in registration costs now will save them money in the long run as they are less likely to damage their cars on newer and better-maintained roads.
Keep your safety in mind when driving on all roads. In the event of an automobile accident, contact us for any assistance on filing a legal claim with your insurance company or against a negligent driver.