Michigan Gov. Calls for Auto Loan Refunds

Michigan Gov. Calls for Auto Loan Refunds

The governor of Michigan will administer auto insurance refunds of about $675 per vehicle as soon as possible.

Democratic Governor Jennifer Granholm attributed a surplus of $5 billion to premium overcharges and a 2019 law that reduced insurers' medical costs for accident victims. Many residents have been impacted financially by the COVID-19 pandemic due to financial hardship.

The association is also a nonprofit organization established by the state to reimburse automobile insurers for those claims above $600,000. Michigan motorists were previously required to pay a unique annual fee of more than $200 per vehicle; the law passed in 2016 says the fee has been reduced to $86.

In the past year, it is estimated that approximately 80% of drivers were given the option to keep their coverage, and most of them chose to keep it.

A spokesman for Whitmer has stated that the surplus from these insurance companies belongs to Michigan policyholders who should receive a check in full from the Michigan insurance company.

It was stated by Kevin Clinton, the executive director of the Michigan Catastrophic Claims Association, that the board, which includes most major insurance companies, will take a look at the request.

Those who support the proposal point out that in addition to providing significant funding, it also happens earlier than the deadline stipulated in the law.

Under the 2019 law, the state director of insurance shall be required to conduct an independent actuarial audit of the state's multi-state captive every third year from now on, starting next year.

According to the report, MCCA will have to refund the difference between its assets and liabilities if its assets exceed its liabilities by 120% by September.

In one of his speeches, Clinton pointed out that using today's figures would yield an approximate cost per vehicle of about $100 if the formula were updated.