Auto insurance refunds have been a key talking point for Gov. Gretchen Whitmer this month — in events and following a campaign promoting them — as she seeks a second four-year term in November.
Here are some answers from Free Press Lansing Bureau Chief Paul Egan about the $400 refunds.
The Department of Insurance and Financial Services also offers its own Q&A.
Am I eligible for a refund?
To qualify, residents must have had to have a vehicle insured in Michigan last Oct. 31. The policy must meets the minimum insurance requirements for operating a vehicle on Michigan roads.
When is the money arriving?
Or as Whitmer might have put it in her first campaign, when do I get my damn check?
That’s really the question everyone wants to know.
According to Whitmer, who held an event earlier this month in Detroit with Mayor Mike Duggan, some Michigan motorists already should have received it. But others may have to wait until May.
How will the money arrive?
The refund — $400 for each eligible insured vehicle — can come in the form of a check or automatic deposits from their insurance companies. Whitmer’s has office said the deadline for auto insurers to send the money to policyholders is May 9.
Why May 9?
The Michigan Catastrophic Claims Association, a fund controlled by the insurance industry, transferred of $3 billion in surplus funds to Michigan’s auto insurers earlier this month.
The money transfer has triggered a 60-day deadline that requires auto insurers — not the state — to send out required $400 refunds per vehicle to eligible Michiganders no later than May 9.
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The MCCA has more than $27 billion in assets, according to its most recent financial statement, but has been holding a surplus, partly as a result of auto insurance coverage changes under the 2019 law.
Is this the refund I saw on TV?
Yes. There was an advertising campaign on the auto insurance refunds. It was paid for by a pro-Whitmer group, Put Michigan First, that is affiliated with the Democratic Governors Association.
Why am I getting a refund?
Whitmer requested it in November.
“These $400 refunds are game-changers for so many Michigan families,” she said in a news release earlier this month. “I called for these refunds because I am committed to lowering costs for Michiganders and putting money back in people’s pockets.”
The MCCA fund, which pays for catastrophic care and gets its money from a catastrophic claims surcharge that used to be tacked on all auto insurance premiums. That fee, which was $220 per vehicle in 2019, has since been significantly reduced.
It is now only paid by motorists who opt for lifetime catastrophic claims coverage.
Whitmer said the fund will continue to hold $2 billion in surplus funds “to ensure continuity of care for catastrophic accident survivors.”
What are Whitmer’s other claims?
The governor also said the refunds: “are possible because we worked across the aisle to pass bipartisan auto insurance reform, and we will keep working together to grow our economy and build a state where families can thrive.”
Is the timing ideal or suspect?
Detroit communications consultant Karen Dumas, who served as communications director for former Detroit Mayor Dave Bing, said that the timing is ideal for Whitmer because “everybody is feeling the pain at the pump and inflation.”
But Dumas also said the refunds are “political or performative,” and most residents are not considering other questions, including whether the refunds should be larger; whether they should have been sent directly to consumers, rather than to insurance companies; the impact of reduced coverage under Michigan’s 2019 changes to the state’s no-fault auto insurance law; and sharply reduced care for many accident victims who were catastrophically injured before the law was changed.
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Detroit residents, she added, still pay high premiums compared to the rest of the state.
Kevin Rinke, a Republican candidate for governor who formerly was an investor in a company that worked with victims of traumatic brain injury, has called the insurance reforms a “bad program.”
A political rival, he accused Whitmer of using the refunds to bolster her re-election campaign by taking “credit for giving us our own money back” heading into an election season.