Auto insurance reform is on the way. But how much will it actually save drivers?

DETROIT (FOX 2) - It's done! They did it!

As Governor Gretchen Whitmer put it on Mackinac Island today "And it is so," she said. Surrounded by applause, Whitmer smiled. Under the blanket of bipartisanship, the governor inked a bill that delivered auto insurance reform to Michigan.

With enough headlines blasting the message that Michigan had the highest rates in the country, the bill-now-law is supposed to bring savings of some kind to everyone in the state.

But how much will those savings amount to?

"The savings we are going to see is limited only to the personal injury protection, or PIP portion of the bill," said Steve Gursten, of Michigan Auto Law. "So any savings we are going to see is limited to this 35 percent of your no-fault bill."

Gursten is referring to a pie chart he's drawn, that divides a circle representing a Michigan resident's auto insurance into three sections. Taking up the majority of the pie was "Collision" followed by a small slice labeled "Other." The second-largest chunk was what Gursten pointed to: the PIP.

"Now the insurance company is only going to pay you for your medical care or attendant care, which is another huge change up to the PIP cap that you choose," he said.

Under the new law, you're not required to purchase unlimited coverage. You can pick your cap, of which there are four: $50,000, $250,000, $500,000 and unlimited. That freedom was touted by the governor when she signed the bill earlier on Thursday, during the policy conference.

As for the direct savings for each driver, that's contingent on the at-fault driver in a collision.

"Everything now depends on what the insurance policy limit is for the negligent driver who caused the crash," Gursten said. "If it's a Coca-Cola truck, you're going to be okay. If it's a person who has a new minimum of only $50,000, you're not going to be okay."

Furthermore, the savings that drivers accrue from insurance don't necessarily mean those costs just disappear. Instead they are shifted to another industry: Medicaid.

"Instead of the insurance company paying for everything, we're actually transferring cost to taxpayers in the form of much higher Medicaid spending because who is going to pay for all this medical care?" he said.

Despite this notion, many celebrated the bill as a groundbreaking bit of agreement between two parties that have slowly drifted apart over hot-button issues. That agreement trickled down into the lobbying groups as well.

"We applaud the legislature and the governor on this historic bipartisan legislation, which takes a major step forward in terms of fixing Michigan's broken, outdated auto no-fault system," said the Insurance Alliance of Michigan. "We are prepared to help fix several technical and drafting issues in the bill to ensure consumers - and not medical providers and trial lawyers - reap the benefits of these historic reforms."

The first part of the bill takes place in June of 2020. The second part comes the year after.