Michigan auto insurance refund deadline next week; $2.2B already returned to drivers

With the deadline for Michigan's auto insurance refund checks to arrive to drivers nearing, the state is reporting $2.2 billion in refunds have been issued out. That's about three-quarters of the estimated $3 billion in planned refunds. 

For any drivers who had their vehicles insured by the end of October, 2021, they should have their $400 refund checks either by mail or direct deposit by May 9. 

A release from the state and the Department of Insurance and Financial Services reports $1.2 billion had been sent out from insurance companies to drivers in just the last two weeks.

"Thanks to the bipartisan auto insurance reform I signed, nearly $2.2 billion has been put back in people’s pockets and another $800 million is yet to come," said Gov. Gretchen Whitmer. "Auto insurers have one more week to issue any remaining refunds to eligible drivers, so if you have not yet received your money, be sure to keep an eye on your mailbox or bank account. These refunds will help families pay the bills and put food on the table as we keep growing our economy, creating more good-paying jobs, and lowering costs."   

As long as drivers are checking their mailboxes for envelopes addressed from their insurance companies, they don't need to do anything else. 

The state announced that $900 million had been returned to Michigan drivers on April 14, a little more than a month after the funds were originally transferred to relevant insurance companies. That was a little less than a third of the estimated $3 billion that was intended to be sent back to drivers.

The $400 refund checks issued to drivers are intended for those who had their vehicles insured by Oct. 31, 2021. The refund is part of bipartisan auto reform legislation passed in 2019 that requires the Michigan Catastrophic Claims Association (MCCA) to issue money back to drivers. 

The MCCA reported a $5 billion surplus before the governor announced how much in funds would be returned to drivers. The organization had until March 9 to pass along the funds to insurance companies, who then had about 60 days to deposit or mail the checks back to drivers.

Refunds must be issued this way. They can not be applied as money toward a balance owed on a plan, and insurance companies cannot issue a gift card or offer future discounts in lieu of payment.

If an insurance company attempts to do this, it can be reported here.

Auto reform legislation was signed into law in the summer of 2019, after years of Michigan reporting some of the highest auto insurance rates in the country.  

Part of the reform package allowed drivers to choose reduced coverage from the Personal Injury Protection category of their plan. Prior to the reform, drivers didn't have a choice when picking their PIP rate. The reform efforts have come under scrutiny from victims involved in accidents that fear losing injury care. 

Are motorcycles and RV owners eligible?

Anyone who insured their vehicle - whether it's a car, truck, RV, or motorcycle - by 11:59 p.m. Oct. 31, 2021, is eligible for a refund. 

The amount of money drivers will receive is per vehicle that's covered under a plan. If a household has two vehicles under the same insurance plan, then the owner would receive $800.

Will drivers that didn't select unlimited PIP still get a refund?

Yes. According to DIFS, all vehicles with a proper insurance plan by Oct. 31, 2021, will get a refund. 

While reforms opened up the option for drivers to pay less for reduced coverage relating to personal injury protection, selecting one of the available options other than ‘unlimited’ will not affect the refund amount.

Are there refunds for insured historic vehicles?

The MCCA only charges 20% of their typical assessment for historical vehicles due to their limited allowable use, DIFS says. As long as the vehicle was injured by the appropriate deadline, drivers will get a refund of $80. 

DIFS also created a FAQ site for drivers to peruse if they have any questions.

Any drivers that are eligible to receive a refund but don't get a check by the May 9 deadline can contact their insurance company with questions. They may also contact the insurance department with concerns Monday through Friday 8 a.m. to 5 p.m. at 833-ASK-DIFS (833-275-3437) or emailing autoinsurance@michigan.gov.

What about refunds for trailers?

Trailers are not subject to the MCCA Assessment and are not eligible for a refund.