A bill banning auto insurers from charging loyal customers higher rates cleared the Michigan Legislature on Wednesday, Sept. 9, and awaits Gov. Gretchen Whitmer's signature.
State Sen. Jeremy Moss, a Bloomfield Democrat, sponsored Senate Bill 1013, which prohibits insurance companies from using "price optimization" to set rates. The practice lets insurers charge customers based on what the company believes they will tolerate paying, according to Moss's office. Loyal policyholders often end up paying more, while customers who threaten to leave get discounts.
The bill passed both chambers of the Michigan Legislature before heading to the governor's desk. If signed, Michigan would join 20 other states that already prohibit the practice, according to Moss.
Why it matters
Michigan has climbed from the 11th most expensive state for car insurance at the end of 2024 to the fourth most expensive today. The average annual full-coverage premium reached $3,229 as of June 2026, according to Insurify.
Moss, who represents the 7th Senate District, said in a statement that the bill is part of Senate Democrats' "A Michigan You Can Afford" agenda. He said the measure provides strong consumer protections and shields residents from unfair rate-setting practices.
When the Senate first passed the bill July 2, before it moved to the House, Moss said insurers use price optimization to unfairly raise rates on loyal customers simply because they know those customers will not leave.
SB 1013 amends sections 2109 and 2119 of the Michigan Insurance Code. Co-sponsors include Sens. Mary Cavanagh, Stephanie Chang, Jeff Irwin and Mallory McMorrow.
What's next
No signing date has been announced. No on-record response from insurance industry groups appeared in public records as of publication.
Residents can track the bill's status on the Michigan Legislature's website.
