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Nesbitt applauds coming auto insurance refunds as a win for Michigan drivers due to Republican-led reforms

LANSING, Mich. — Sen. Aric Nesbitt on Tuesday applauded the Michigan Catastrophic Claims Association’s (MCCA) announced plan to refund state drivers $400 per vehicle during the second quarter of 2022.

“I am happy to see Republican-led efforts to lower auto insurance rates will provide drivers a $400 per vehicle refund,” said Nesbitt, R-Lawton. “This announcement is a big win for Michigan’s auto owners and a direct result of our landmark reforms passed by the Legislature in 2019, which put an end to the outdated system that burdened Michigan drivers for decades.”

The MCCA levies assessments each year to cover claims for those catastrophically injured in car accidents. The association’s surplus has grown from $2.4 billion at the end of 2020 to $5 billion by June 30.

The Legislature’s auto insurance reform, now Public Act 21 of 2019, directed the MCCA to issue refunds to drivers every three years following an audit by the Department of Insurance and Financial Services (DIFS); the first refunds were previously expected to be issued following a 2022 audit.

“Michigan families, seniors and all other drivers have been feeling the economic pinch of the COVID-19 pandemic ­— and now growing inflation — and need as much relief as they can get,” Nesbitt said.

The MCCA board voted on Nov. 3 in favor of issuing refund checks following an organizational analysis that found about $3 billion of the surplus could be returned to policyholders. The association formally submitted its refund plan to DIFS on Monday; refunds will be issued to every Michigan resident with an auto insurance policy in force as of 11:59 p.m. on Oct. 31.

MCCA will turn over surplus funds to insurance companies by March 9, 2022, and the insurers will be responsible for issuing checks to eligible policyholders 60 days after the transfer of funds.