Have you ever looked at your Michigan Auto Insurance bill and wondered what the MCCA Fee is on there? We’ll help explain.
Who is the Michigan Catastrophic Claims Association (MCCA)
In 1978, the State of Michigan legislatively created The Michigan Catastrophic Claims Association (MCCA). The Association is setup as a private non-profit unincorporated association. Michigan’s unique auto insurance no-fault law provides unlimited lifetime coverage for medical expenses which result from auto accidents. The purpose of the Association reimburses auto no-fault insurance companies for each Personal Injury Protection (PIP) medical claim paid in excess of a set amount. Currently that amount is $545,000. That means that the insurance company pays the entire claim, but is reimbursed by the MCCA for medical costs over $545,000.
Every insurance company in Michigan is assessed to cover the catastrophic medical claims that happen in Michigan. These assessments are generally passed down to the customer. In 2016-2017 the fee was $160, this is slated to increase to $170 in July of 2017 and is a per vehicle assessment fee. There is a slightly reduced fee for vehicles registered as Historic Vehicles in Michigan.
How Does the The MCCA Come Up With It’s Fee?
The law requires the association to calculate the premium (assessment) on an annual basis. The premium is required to be sufficient to cover the lifetime claims of all persons catastrophically injured in that year. The association also adjusts the premium (assessment) for excess or deficiency in earlier assessments.
Each insurance company writing auto or motorcycle insurance in Michigan is required to be a member of the MCCA. The insurance companies pay a premium (assessment) to the association. Companies writing personal auto or motorcycle insurance pay a per vehicle amount to the MCCA and that cost (assessment) is generally passed on to policyholders.
Who Has The Michigan Catastrophic Claims Association Helped?
A catastrophic claims that MCCA helps with involve injury to the brain, and/or spinal cord which results in serious and permanent disability. i.e., paralysis, coma, and reasoning ability. Since 1978, they have had 35,275 claims, and made payments totalling over $14 BILLION Remember, Michigan has unlimited lifetime coverage for injuries.