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Whitmer asks MCCA to speed up refund payment

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Whitmer asks MCCA to speed up refund payment

Governor Gretchen Whitmer has called on the Michigan Catastrophic Claims Association to adopt an accelerated schedule to approve refund checks to auto insurance customers.

“The surplus belongs to Michigan policyholders and should be promptly returned directly to them in full, in the form of refund checks,” Whitmer wrote Monday in a letter to MCCA Executive Director Kevin Clinton.

The governor said MCCA fund has banked $5 billion dollars – due largely to a benefits cap on payouts for catastrophic injury claims that she signed into law:

The surplus reflects premium overcharges and is partly a reflection of the cost-saving measures implemented in the historic, bipartisan no-fault reform legislation I signed into law in 2019. Since then, many Michiganders have experienced financial hardships during the ongoing COVID-19 pandemic. Now is not the time for the MCCA to withhold money owed to Michiganders. I urge you to move swiftly to return the surplus funds to policyholders in the form of lump-sum checks. Billions in surplus funds should not be held by insurers to invest for their own profit or be conditioned on the renewal of a policy.

The signed by the governor in 2019 reduce a surcharge to fund the MCCA and cap benefits. The law has come under fire for its limits on payments to help care for people who are severely injured in car crashes.

Critics say that will drain the fund of reserves needed to fix problems with the law.

An insurance industry group released a statement saying, if the law is changed, it should guarantee limits on provider payments will remain.