Whitmer: Michigan motorists to receive auto insurance refunds of $400 per vehicle [Detroit Free Press]

Detroit Free Press (MI)

LANSING — The Michigan Catastrophic Claims Association will issue $3 billion in auto insurance refunds — about 400 per insured vehicles — to Michigan drivers, Gov. Gretchen Whitmer and the Department of Insurance and Financial Services announced Tuesday.

Drivers are expected to receive checks in the second quarter of 2022, Whitmer said in a news release.

Whitmer called for refunds on Nov. 1, saying the surplus in the Michigan Catastrophic Claims Association Fund had grown to $5 billion since she signed into law bipartisan auto insurance legislation in 2019 that was intended to lower premiums and gave options of reduced medical coverage while significantly reducing medical fee schedules for long-term medical care.

More: Gov. Whitmer calls for billions in auto insurance refunds for Michigan motorists

More: Michigan motorists to receive insurance refunds, with when and how much to be determined

The MCCA is a nonprofit corporation controlled by the insurance industry that manages a fund intended to pay for catastrophic care. The fund, with assets of more then $27 billion, was built with surcharges that used to be applied to the premiums of all insured vehicles in Michigan.

"These refunds and the recently announced statewide average rate reductions are lowering costs for every Michigan driver," Whitmer said in the news release."Michiganders have paid into the catastrophic care fund for decades, and I am pleased that the MCCA developed this plan so quickly after unanimously approving my request to return surplus funds to the pockets of Michiganders.

Advocates for Michigan accident victims have criticized the refund plan, saying it will remove funds intended to pay for care of catastrophically injured residents who are suffering under the new legislation. Republicans have accused Whitmer of playing politics with the issue. Refunds are expected to be issued months before the November vote in which Whitmer is expected to seek re-election.

Lt. Gov. Garlin Gilchrist said the refunds are a victory for all Michigan motorists, but particularly for motorists in Detroit, who "have paid the highest insurance rates in the nation for decades."

Eligible consumers do not need to take action in order to receive a refund. The surplus funds will be turned over by the MCCA to the insurance companies operating in Michigan by March 9, 2022, and the insurers will be responsible for issuing checks to eligible policyholders, the news release said.

Contact Paul Egan: 517-372-8660 or pegan@freepress.com. Follow him on Twitter @paulegan4. Read more on Michigan politics and sign up for our elections newsletter.

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