What is the Michigan Catastrophic Claims Association
The Michigan Catastrophic Claims Association (MCCA), a private non-profit unincorporated association, created by the state Legislature in 1978. Michigan’s the only state where auto insurance no-fault law provides unlimited lifetime coverage for medical expenses from auto accidents. The MCCA fund will reimburse auto no-fault insurance companies for each Personal Injury Protection (PIP) medical claim paid in excess of a set amount. Currently, MCCA will reimburse Michigan auto insurance companies all medical costs over the $555,000 total.
How is the Michigan Catastrophic Claims Association funded?
All auto insurance companies operating in Michigan are assessed to cover the catastrophic medical claims occurring in Michigan. Those assessments are generally passed on to auto insurance policyholders. Every Michigan insured will be assessed $192.00 per vehicle. The 2018 assessment is made up of the pure premium (the actual cost for each vehicle in the state of Michigan to fund the MCCA pool) which is $167.10. Added to that is an adjustment of $4.50 to recoup part of a deficit that currently exists and a $.40 administrative expense. The current assessment period is effective July 1, 2018, to June 30, 2019. This assessment will increase $22 to $192 effective July 1, 2018.
Exceptions from the Michigan Catastrophic Claims Association:
- Historic vehicles are only assessed 20 percent of the full assessment charged for vehicles effective July 1, 2003. The assessment for historic vehicles for 2018 is $38.40.
- Motorcycles also have to pay into the fund but, motorcycles are specifically excluded as a motor vehicle under the no-fault law, because of this motorcycle insureds will not have the same unlimited medical coverage provided by the Michigan no-fault policy. Insureds have the option of purchasing additional medical coverage under a Michigan motorcycle insurance policy.
Michigan Catastrophic Claims Association controversy:
Currently, there is a controversy surrounding Michigan Catastrophic Claims Association because only a small number of drivers receive these benefits compared to the drivers paying into the fund. Plus Michigan is the only state in the country proving this type of unlimited medical coverage. Also in August 2015, there was a suit filed against MCCA releasing their records under the FOIA. The MCCA feels it is expressly exempted from the FOIA under a 1988 amendment to the state Insurance Code, which states “a record of an association or facility shall be exempt from disclosure,” and defines an association or facility to include “the catastrophic claims association.” The Coalition Protecting Auto No-Fault and the Brain Injury Association disagree and are waiting to see if the Michigan Supreme Court will agree. In 2017 the Michigan Supreme Court declined to hear the case.