Michigan’s no-fault auto insurance fee is going up — again

March 29--LANSING -- The fee motorists pay to cover catastrophic medical claims under the state's no-fault insurance plan is increasing by double digits, an association announced Thursday.

The per-vehicle assessment will increase to $192 on July 1, up from $170 currently, the Michigan Catastrophic Claims Association announced. That's a 13% increase, which follows a 6.3% increase in 2017.

It's the latest in a series of extra costs to hit motorists, who are paying 20% more for their vehicle registrations and 7.3 cents per gallon more in state gas taxes under the 2015 road funding deal.

The association, whose board is dominated by insurance companies, said the increase is necessary because of higher-than-anticipated claims costs, partly offset by better-than-expected investment returns.

Michigan's system is unique in that it provides for unlimited, lifetime medical auto insurance benefits for catastrophic claims. The fee covers benefits that exceed $550,000 per claim, the MCCA said.

Looking at the new $192 fee, $161 will go to cover anticipated new claims and expenses, and $31 will be used to address an estimated $2.3-billion deficit, the association said.

The Michigan Legislature has considered several proposals to rein in Michigan's auto insurance costs, but lawmakers have been unable to agree on a plan.

The Coalition Protecting Auto No-Fault waged a lengthy legal battle against the MCCA over access to the methods and calculations the MCCA uses to set its annual fee.

But Michigan courts have ruled the association, though a public body, is not subject to Michigan's Freedom of Information Act.

"No one knows how they're estimating this deficit and how they're managing their finances, because they don't provide the rate-making data to the public," said Josh Hovey, a spokesman for the coalition.

"This just screams for transparency," and "we need a legislative fix," Hovey said.

The MCCA says it releases adequate information about the rate-setting process.

The association says it has assets of $20.7 billion, but liabilities of $23 billion.

Contact Paul Egan: 517-372-8660 or [email protected]. Follow him on Twitter @paulegan4.

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