Michigan House Considers Bills on Assigned Claims Plan

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Michigan auto insurers never stop trying to find new ways to make more money off of their customers. This year, they have turned to the legislature, trying to push changes to the Assigned Claims Plan. Now the Michigan House of Representatives is considering those changes and the future for along with them, no-fault insurance in Michigan.

Auto insurance has been on the minds of Michigan legislators a lot recently. Earlier this month, the Michigan House of Representatives passed a bill to fix a tax credit that accidentally gave the auto industry almost $60 last year. Now they are once again considering changes to the Michigan Assigned Claims Plan, and this time, the changes are backed by the auto insurance industry.

Cutting Off the Accidental Tax Credit

In 2012, Michigan law changed. Up until that time, the Michigan Assigned Claims Facility (MACF) was administered by the Secretary of State on the government’s dime. It provided a safety net for injured motorists who otherwise would not receive no-fault benefits after a serious auto accident.

Then in 2012, the Michigan legislature amended the law, replacing the MACF with the Michigan Assigned Claims Plan (MACP), which was administered by the Michigan Auto Insurance Placement Facility, which was operated by the auto insurance industry. But doing so created a tax loophole that the auto insurance companies were quick to take advantage of.

So on June 2, 2016, the Michigan Legislature passed a pair of bills closing that loophole. House Bills 5457 and 5458 would change the Income Tax Act and Michigan Business Tax Act so auto insurance companies cannot claim tax deductions for contributions to the Michigan Automobile Insurance Placement Facility (MAIPF) if that money is going toward the Michigan Assigned Claims Plan. The bills are now being considered by the Michigan Senate.

More Changes on the Horizon for Michigan Assigned Claims Plan

Michigan auto insurers aren’t taking the change lying down. Instead, they are pushing another change to the Michigan Assigned Claims Plan. On May 12, 2016, Republican Representative Al Pscholka put forward House Bill 5654, which would change the requirements for a person to qualify for coverage under the MACP. These changes are based on lobbying efforts by the auto insurance industry during negotiations on the earlier tax loophole bill.

There hasn’t been an official analysis of the bill or its impact on Michigan drivers yet. But the timing makes one thing clear: these industry-backed changes could threaten injured motorists who fall through the Michigan no-fault insurance system by making it harder for them to qualify for MACP coverage.

David Christensen is an auto accident attorney at Christensen Law in Southfield, Michigan. He has fought against the auto insurance companies for over 20 years. If you have been seriously injured in an auto accident, contact Christensen Law for a free consultation today.