- everyone in michigan with a car-insurance policy is getting a $400 refund check next spring, the state's governor announced today.
- the money comes from the surplus in the state's catastrophic claims association fund, which built up because all drivers were previously required to pay for unlimited personal injury coverage.
- the state fund will hand over the surplus to insurance companies in early march, and the insurers will send out $400 for each insured vehicle within 60 days after that.
the state of michigan has been infamous for having the highest auto insurance rates in the country. there's a reason for it: the state has had a mandatory unlimited personal injury protection requirement on auto insurance since the 1970s. but that requirement was overturned under insurance reform after july 1, 2020. now gov. gretchen whitmer has announced that drivers are getting some of that money back.
in early march 2022, the governor's office announced today, insurance companies will be receiving some of the $5 billion surplus currently sitting in the michigan catastrophic claims association (mcca) fund. within 60 days after that, the insurers will be cutting checks to drivers for $400 each. everyone in michigan who had a car-insurance policy in force on october 31 is eligible, and drivers do not have to do anything to get this money.
the one exception to the $400 refund is for vehicles with "historical vehicle" plates. their owners will get $80 refunds.
created by michigan's state legislature in 1978, the nonprofit mcca assesses insurance companies a fee that changes each year, intended to cover catastrophic medical claims resulting from michigan auto accidents. in turn, the insurance companies pass the cost to drivers. although the law was changed in 2019 so that drivers no longer must pay for unlimited coverage, the detroit news reported today that about 80 percent of michigan drivers have elected to keep the higher level of coverage anyway.
the mcca said there were other reasons besides the change in the law for its massive surplus, including higher-than-estimated returns on investments as well as fewer catastrophic claims because people have driven less during the covid-19 pandemic.
since the insurance-reform law that went into effect in july 2020 was intended to make car insurance more affordable, it also came with an amnesty program for uninsured drivers. the 18-month amnesty period expires on new year's day 2022. under it, uninsured drivers are allowed to get new insurance policies without penalties. detroit mayor mike duggan told the detroit news last month that more than 100,000 previously uninsured drivers have become insured in michigan since the reform law went into effect.