Auto insurance refund: Michigan to give back $400 to each insured vehicle

As Michigan sits on billions of dollars of financial surplus in its Catastrophic Claims Association Funds, the governor is returning some of the money paid by people who have auto insurance.

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Gov. Gretchen Whitmer announced Tuesday that drivers will be getting $400 back for each insured vehicle they own, the Detroit Free Press reported.

The payout will be $3 billion returned to the residents of Michigan.

The checks will be issued in the second quarter of 2022, WDIV reported.

The Michigan Catastrophic Claims Association Fund is a nonprofit corporation founded in 1978 that helps pay for catastrophic care and is funded by surcharges from insurance premiums. It has more than $27 billion of assets, but an analysis of the corporation found that $3 billion could be returned to those who have paid in without cutting coverage.

An auto insurance reform signed in 2020 got rid of the law that required vehicle owners to buy unlimited lifetime medical expense coverage for injuries from vehicle accidents that the MCCA helped cover the cost of claims.

Some Republicans think that the payout is a political move, with the money expected to be returned months before Election Day. Whitmer, a Democrat, is expected to run for re-election, the Free Press reported.

Owners who had their vehicle insured as of Oct. 31, 2021, are eligible and do not have to do anything to get their refund. Most owners will get $400, paid out by the MCCA via insurance companies, except for those who have a “historical vehicle” plate. They will get $80, the Detroit Free Press reported.