Last of $400 auto insurance refunds due to Michigan drivers

Nearly $3 billion in auto insurance refunds were due to be distributed over the past two months to Michigan drivers, with Monday closing out the period for insurance companies to distribute the $400-per-policy checks to Michigan drivers. 

The refunds came from a roughly $5 billion surplus in the Michigan Catastrophic Claims Association fund that accumulated after the passage of the 2019 historic no-fault auto insurance reform package. 

Gov. Gretchen Whitmer called on the association in November to refund the surplus money to Michigan drivers, specifically anyone who had an insured motorcycle, car or recreational vehicle as of 11:59 p.m. Oct. 31. Policies for historic vehicles were refunded $80 per historic vehicle. 

“Our efforts put money back in the pockets of Michigan drivers this year and have also delivered more than $1 billion in statewide premium savings since the law took effect," Whitmer said. 

House Speaker Jason Wentworth, who chaired the  committee that wrote and negotiated the 2019 reform, celebrated the refunds Monday as coming at an opportune time for individuals struggling with inflation. 

"Fortunately, this massive refund from our car insurance reform law is hitting at the just the right time to help all our families make ends meet and stay on top of our monthly bills," said Wentworth, R-Farwell. "When you add this refund to the lower rates, lower MCCA annual fees and new low-cost choices, car insurance reform just keeps paying off in a big way for Michigan drivers.”

Individuals who have not yet received their check, but believe they are eligible should contact their auto insurer, said Michigan Department of Insurance and Financial Services Director Anita Fox. If no resolution can be reached with the insurance company, drivers should contact the department at (833) ASK-DIFS between 8 a.m. and 5 p.m. Monday through Friday.

The $3 billion in refunds was transferred to insurance companies in early March for distribution to insured drivers by May 9. The other $2 billion was reserved to "ensure continuity of care for accident survivors." 

In the coming days, insurance companies will be required to confirm with the department that they distributed all refunds to customers as planned, the department said.

The catastrophic claims association, created by the Michigan Legislature in 1978,  reimburses auto insurance companies after a certain threshold — about $600,000 — is reached for medical costs.

While officials have celebrated refunds and premium cuts as a result of the legislation, protesters have been a regular presence at the Capitol as the 2019 reform has taken full effect and led to declines in services that victims of catastrophic crashes have been receiving.

In particular, a July 1 45% fee cut to medical providers has brought demonstrators to the Capitol regularly, arguing the cut is too steep for those medical providers to continue giving the care needed to individuals injured in catastrophic crashes. 

eleblanc@detroitnews.com

Staff writer Craig Mauger contributed.