(WXYZ) — Michigan Gov. Gretchen Whitmer and the Michigan Department of Insurance and Financial Services announced early Tuesday that $3 billion in refunds are coming to Michigan drivers from the Michigan Catastrophic Claims Association.
According to the governor's office, the MCCA has acted on her call to return surplus funds to policyholders, and will immediately begin processing $400 per vehicle refunds to Michigan drivers. The checks are expected to arrive in the second quarter of 2022.
“Michiganders have paid into the catastrophic care fund for decades, and I am pleased that the MCCA developed this plan so quickly after unanimously approving my request to return surplus funds to the pockets of Michiganders," Whitmer said in a release. "We are working together to put Michigan drivers first, and I am directing DIFS to ensure that the MCCA and Michigan’s auto insurance companies accurately, fairly, and promptly issue these refunds.”
Last month, the MCCA supported Whitmer's call for the refunds to Michiganders with auto insurance. The refund is part of a bipartisan auto insurance reform law, Senate Bill 1, signed by the governor in 2019.
7 Action News asked Anita Fox, the Director of the Michigan Department of Insurance and Financial Services, which regulates the insurance industry who will be getting the refund.
“I believe this will be to every single Michigan insured,” said Fox.
“It will be a per vehicle check. They will come with an amount and however vehicles you have insured in Michigan you will get that amount per vehicle,” said Fox.
Governor Gretchen Whitmer has emphasized that the surplus exists because of overpayments, but Fox says it is also in large part due to investment returns and cuts.
“A second thing is, we had a change in the law that allowed for savings in a bunch of different ways,” said Fox.
The change in law included a 45% cut in care for people who suffered catastrophic injuries in car accidents.
“That money that she is giving away to all drivers is supposed to be paying for April’s care and everybody’s care,” said Gabriel Mongefranco of Ann Arbor.
Gabriel Mongefranco says the savings came at the expense of people like his wife April, who suffered a spinal cord injury in a car accident, leaving her in need of 24-hour care.
They have two children, Ezra and Christina.
“They are so young, 3 and 6. They need their mom,” said April.
The couple says they are emptying their retirement savings to pay for caregivers because they say insurance stopped covering the costs needed when the 45% coverage cut went into effect in July. They fear April will face life in a Medicaid facility once their savings run out in a few months if lawmakers and the governor don’t approve introduced legislation that would restore funding for care.