Michigan drivers will start receiving $400 auto insurance refund checks this week

Michigan's auto insurance refund check that's owed to drivers will start arriving in bank accounts this week, according to the state's department of financial services.

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. 

Over the next 60 days, the $400 refunds owed to drivers will be deposited electronically in bank accounts. Gov. Gretchen Whitmer first announced the rebates in December 2021, with guarantees that refunds will be transferred from the MCCA to insurers by March 9. 

"The Governor directed DIFS to take an active role in ensuring that refunds would be issued expeditiously to Michiganders who have paid into the fund for decades," said Anita Fox, who heads the Department of Insurance and Financial Services. "The DIFS bulletin ensures that consumers are protected and imposes a May 9, 2022 deadline for issuing refunds to all eligible drivers."

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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. 

Under state law, the MCCA collects funds to cover claims for those who are catastrophically injured in car accidents. Last year, it reported a $5 billion surplus. After Whitmer called on the association to issue refunds, the group's board voted on rebates of $400 per vehicle - which totals to about $3 billion. 

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In determining how much it should give back, the MCCA said it needed to balance maximizing the refund amount while maintaining sufficient funds to cover those catastrophically injured. With the deadline nearing for funds to be transferred to insurers, drivers with insured vehicles can expect the funds to arrive within the next two months. 

Even if a driver owes money to their insurance company, they will still receive a refund. Here's other information to know:

Who is eligible for refunds?

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.