Gov. Gretchen Whitmer calls for auto insurance industry to refund Michigan drivers billions

Gov. Gretchen Whitmer has requested an association representing auto insurance companies refund Michigan drivers billions of dollars after the group reported a $5 billion surplus in June.

In a letter sent to the executive director of the Michigan Catastrophic Claims Association, Whitmer said she was "calling on you today to refund money to Michiganders."

"The surplus reflects premium overcharges and is partly a reflection of the cost-saving measures implemented" in the government's auto reform bill passed in 2019, went the letter.

The MCCA is responsible for paying for catastrophic care needs and is headed by members of the insurance industry. The payouts come from a fund that is supplied by surcharges from drivers.

According to Whitmer's letter, the MCCA had a $2.4 billion surplus in 2020 and a $5 billion surplus by June 30, 2021. The letter was addressed to the MCCA director Kevin Clinton.

The governor said the time for sending the refunds was now due to "financial hardships during the ongoing COVID-19 pandemic."

RELATED: Michigan is no longer the most expensive state to insure a car

The refunds would be sent to every Michigan motorist that has auto insurance.

Auto insurance reform legislation was passed in May 2019 that both the governor and the legislature have touted as a bipartisan accomplishment. The 2019 legislation guaranteed lower rates for eight years that allowed drivers to select different Personal Injury Protection coverage. 

It also banned insurance companies from using non-driving factors to set rates.

Read the governor's full letter below: