Michigan car insurance refund checks coming: What you need to know

Checks will start hitting mailboxes this week

Michigan parking lot with probably insured cars.

Eligible Michigan drivers will start seeing $400 refund checks starting this week. Here’s everything you need to know.

Gov. Gretchen Whitmer and the state’s top insurance regulator said Monday that a $3 billion transfer of surplus funds from the Michigan Catastrophic Claims Association to car insurers will be completed this week. The companies will have 60 days to issue the refunds — no later than May 9. Checks could arrive in the mail for some starting this week.

More: Insured Michigan drivers will start getting $400 refunds soon

We’ve received many questions about the refund checks, so here’s a roundup of answers to the most common ones.

Who is eligible to get a refund?

All vehicles that were insured as of 11:59 p.m. on October 31, 2021 are eligible to receive a refund if the vehicle was covered by a policy that meets the minimum insurance requirements for operating a vehicle on Michigan roads.

Do I need to do anything?

A refund check or an ACH deposit will be issued to eligible Michigan policyholders. If you are eligible to receive a refund, it will be sent to you by your insurance company and you will not have to do anything to receive it.

Are motorcycles and/or RVs eligible?

Yes, motorcycles and RVs are eligible for the $400 refund if the motorcycle or RV was covered by a policy that meets the minimum insurance requirements for operating on Michigan roads. Trailers are not subject to the MCCA assessment and therefore are not eligible for the refund.

I don’t have unlimited PIP coverage. Am I eligible?

Yes. All qualified vehicles are eligible to receive a refund regardless of the PIP medical coverage level chosen on the policy.

I sold my car in July and did not have an insured vehicle of Oct. 31, 2021. Am I eligible?

No. Only vehicles that were insured as of 11:59 p.m. on October 31, 2021 will qualify for a refund.

What does this mean for people currently receiving care for auto accident injuries?

This refund does not impact the care auto accident survivors are entitled to under their auto insurance policy. The MCCA’s actuarial analysis determined that approximately $3 billion of the surplus could be returned to policyholders while ensuring continuity of care for auto accident survivors.

As of June 2021, the MCCA catastrophic care fund had more than $27 billion in assets with estimated liabilities of $22 billion.

What if I moved since Oct. 31, 2021?

Your insurance company will send your refund via check or ACH deposit to the address or bank account it has on record. To prevent delays in getting your refund, if you have moved, you should contact your insurance company to ensure it has your current information.

Is the refund taxable?

The MCCA refunds are generally not taxable for most Michiganders. People who deducted their auto insurance premiums as a business expense may be required to include all or a portion of this refund as income on their tax returns. Please consult your insurance agent or tax professional if you have questions about your specific circumstance.

What if I changed insurers since Oct. 31?

The insurer that insured your vehicle on October 31, 2021, at 11:59 p.m., will be responsible for issuing the refund.

You can find more FAQ from DIFS right here.

The state said eligible consumers who do not get refunds should contact their auto insurer or agent. Those who are unable to resolve questions or concerns can contact the state Department of Insurance and Financial Services.

The catastrophic care fund, which reimburses insurers medical and other costs for people seriously injured in crashes, is funded with an annual per-car fee that became optional under a 2019 law. The governor has attributed the surplus and refunds in part to the law that also curbed or cut what health providers and home aides can charge auto insurers, which said they were being gouged.

Michigan drivers with auto insurance will soon starting getting previously announced $400 refunds per vehicle. Gov. Gretchen Whitmer and the state's top insurance regulator said Monday that a $3 billion transfer of surplus funds from the Michigan Catastrophic Claims Association to car insurers will be completed this week. The companies will have 60 days to issue the refunds — no later than May 9.

About the Author:

Ken Haddad is the digital content and audience manager for WDIV / ClickOnDetroit.com. He also authors the Morning Report Newsletter and various other newsletters. He's been with WDIV since 2013. He enjoys suffering through Lions games on Sundays in the fall.