Coalition Protecting Auto No-Fault

LANSING– Department of Insurance and Financial Services Director Kevin Clinton has denied a Freedom of Information Act (FOIA) request that would have provided transparency and access to critical information needed to determine how the Michigan Catastrophic Claims Association (MCCA) annual assessment, which is ultimately paid by Michigan auto owners, is computed.  

 “There’s a reason that newspaper editorial boards throughout the state and across political spectrums have called for transparency in the MCCA,” said Coalition Protecting Auto No-Fault (CPAN) President John Cornack. “Every driver in Michigan will soon be paying $186 per year into the MCCA, which currently reports holding about $15 billion in assets, yet the fund is completely controlled by insurance companies with almost zero public oversight.”

Reports showing projected deficits in the MCCA have been used by the insurance industry to support significant changes to no-fault auto insurance proposed in House Bill 4612. CPAN has been attempting to access the actuarial data and economic assumptions on which the MCCA’s financial projections are based.

“The proposals lawmakers are considering in HB 4612 will have very serious consequences, including a reduced quality of life for catastrophically injured people and a massive cost-shift onto the state Medicaid system,” said Cornack. “Legislators have the responsibility to verify the MCCA’s numbers before blindly accepting legislation that benefits one industry at the expense of injured people, healthcare providers and taxpayers.”

House Bill 4612, sponsored by Rep. Pete Lund (R-Shelby Township), imposes a $1 million lifetime cap on auto injury benefits; mandates government price controls on healthcare providers treating auto accident victims; and sets limits on attendant care, rehabilitation and other services provided to catastrophically injured accident victims.

Late last year, CPAN and the Brain Injury Association of Michigan obtained a ruling in Ingham County Circuit Court that would make MCCA documents publicly available. The MCCA has since appealed that ruling and the case is waiting to be heard in the Michigan Court of Appeals.

The documents requested of Director Clinton are exactly the same as those CPAN requested from the MCCA in its pending lawsuit. CPAN consulted with former Missouri Insurance Commissioner and insurance regulation expert Jay Angoff to determine the specific documents needed to determine how the Michigan Catastrophic Claims Association (MCCA) annual assessment is computed.

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