Lawmakers pleased, caregivers concerned about auto insurance refunds

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GRAND RAPIDS, Mich. (WOOD) — Lawmakers are applauding the decision to issue Michigan drivers insurance refunds that could surpass $600.

The Michigan Catastrophic Claims Association this week agreed to grant a request from Gov. Gretchen Whitmer to issue the refunds, though it’s not yet clear when they will go out or precisely how much money they will be.

State Sen. Aric Nesbitt, R-Lawton, said drivers are owed a refund from the catastrophic claims fund by law.

“If that fund is over 120% funded, all that money on top of that would have to be refunded to drivers here in the state,” Nesbitt said.

Lawmakers on both sides of the aisle support the refund.

“I like the idea that if there’s a surplus and there’s a law that compels overage that’s beyond what is needed to cover catastrophic claims and people with severe accidents, then that comes back to the insured, the policy holders, the citizens that are driving their cars,” state Sen. Sean McCann, D-Kalamazoo, said.

In asking the MCCA to send out the refunds, Whitmer a surplus in the fund that has doubled over the last year to $5 billion.

“It looks like because of market conditions and less claims, we had a real drop in claims during the COVID time when everyone wasn’t driving, that a refund of some kind looks in order and the bigger the better,” McCann explained the swift growth.

A group of coalitions representing the catastrophically injured expressed concern about the decision to issue refunds.

“Gov. Whitmer and the MCCA are financing refunds by raiding a fund designed to care for survivors of catastrophic auto accidents, even as victims continue to lose care due to Michigan’s government-mandated 45%-cut on care reimbursements,” Coalition Protecting Auto No-Fault President Devin Hutchings said. 

Tom Judd, the president of the Michigan Brain Injury Provider Council, said until the loss of care is addressed, the funds should stay put.

“Instead of looking at ways to take money out of the fund, we need to make sure that that fund is viable for current and future auto accident victims,” Judd said.

The MCCA said in statement it would keep enough money in the the fund “to ensure high-quality care to those who have been catastrophically injured.”

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