Last year, insurance companies offered drivers a few small discounts and rebates. Now, they’re feeling the pressure to give more money. Another round of refunds is on the way to drivers in one state after the governor accused insurance companies of hoarding billions of dollars in extra funds, according to MoneyWise.
Car Insurance Refund
At this point in the coronavirus pandemic, government-issued stimulus checks aren’t the only source of new money for taxpayers. Rebates have also been offered by car insurance providers in the United States. With widespread lockdowns and a growing number of people working remotely or from home, it was inevitable that people would spend less time on the road.
Governor Gretchen Whitmer called for the Michigan Catastrophic Claims Association to distribute funds from its $5 billion surpluses back to citizens, insured Michigan drivers will receive refunds. According to Click on Detroit, since June’s $5 billion surplus report, Whitmer wrote to the Motor Carrier Compensation Association (MCCA) requesting that it immediately refund insured drivers. In a unanimous vote on Wednesday, the association’s members agreed with Whitmer’s request.
Michigan Catastrophic Claims Association
According to WXYZ Detroit, the MCCA was established by the Michigan Legislature in 1978 as a private, non-profit organization. Until 2020, it will reimburse no-fault insurers for PIP medical claims exceeding $600,000 until auto insurance reform is implemented. Michigan charged drivers a one-time, annual fee per vehicle for unlimited health insurance until the law was passed.
Gretchen Whitmer, the governor of Michigan, has called for refunds of up to $675 per vehicle in her state to be “promptly returned” to policyholders. The association’s members have quickly reached an agreement to refund, but they aren’t sure they can do so in full, as the governor has requested. Only $100 refunds may be mandated by law, forcing drivers to look elsewhere for substantial savings.