Poll: Should the state treasurer review the Michigan Catastrophic Claims Association?

Jen Eyer | By Jen Eyer |
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on April 20, 2012 at 6:20 PM, updated April 20, 2012 at 6:40 PM
Southbound traffic.JPGYour car insurance rates are going up ... and you didn't have a say about it.

Tim Skubick's column today about the Michigan Catastrophic Claims Association unified commenters from across the political spectrum.

Skubick related a plan by Rep. Phil Cavanagh (D-Redford Township) to order the state treasurer to review the MCCA books and if need be appointed an Emergency Manager to run it. This is in light of the recent premium hike to $175 a vehicle — the highest amount ever — and the fact that everything the MCAA does most of its business in secret.

Many commenters were outraged at the lack of oversight and transparency with regards to the MCCA.

cmoore What amazes me is most citizens just merrily pay it without giving the fund a second thought. The tax has increased by 2489% just since 2000? The citizens of this state need to rise up and say we have had enough. I know I've had enough. I'm going to get in touch with Rep Cavanagh and thank him from the bottom of my heart for having the guts to stand up and do something. A white hot light needs to be shined on this. The fund needs to be abolished and auto insurance rules and regs need to be reformed so citizens can chose the products they want and not have things like the MCCA crammed down their throat.
Big Dutchman: This surcharge has gone out of control - we've four cars in our family, meaning that we'll be paying $700/annually into this fund soon. Frankly, this fund has become "The Thing," and it's growing with nothing to stop it. This is an issue that should continue to have sunlight thrown on it - let's get it out of the dark room and put some transparency into the process. It's now hurting those who it's supposed to help.

A few commenters were less ready to pass judgment, however:

dvmcc: An interesting article. I was almost all up in arms until I did a little reading on the MCCA. The cost that is assessed to the insurance companies actually increases or decreases year to year based on the actuarial assessment that is done. In the early 1990's the cost for each insured vehicle was about $110. That subsequently dropped to about $6 by the year 2000 before increasing to this year's amount of $145. Also, it is somewhat misleading to call this a tax. It is a cost that we, the citizens of Michigan, have by statute imposed upon the insurance companies. But like any business, they pass that cost on to us - the consumers.

Several argued that the issue highlights the need for universal health care.

jimcarravall: Everyone who purchases health insurance has an average of $1,000 per year added to premium costs to keep emergency rooms open in the event someone who shows up for treatment cannot pay the bill they incur. And, anyone who drives an insured car in Michigan gets a $175 bill per car tacked on to handle cost for those whose insurance coverage is exceeded by the cost of their injuries in an automobile accident. Couple that with insurance industries allowed up to a 20-percent overhead for their "service" (keeping 20-percent of the money charged the "insured" before the remaining pays for a physician / facility providing care) and you have enough funding to send to Medicare for universal health coverage.

One commenter is ready to do away with the no-fault system, while others argued more generally for some type of reform.

johnnydepth: It is a shame that people have problems when they are involved with uninsured motorists but those burdens should not be thrown on the rest of us. That is what the courts are for. I too have more than 1 vehicle and it irratates the hell out of me to pay someone elses bill. The same is true with the michigan builders lien fund. I used to be a contractor builder of homes etc. The politicians decided to build a fund to pay off the bills of idiot contractors at our expense.
Skoon86: Seems like it's high-time for some insurance/tort reforms and put Michigan on an even playing field with the rest of the states for auto and motorcycle insurance, as well as making it consistent in Michigan for cars and motorcyclist. If you're going to complain about the high cost if the MCCA, let's complain about why Michigan is the only state in the Nation that has it in the first place.
zeeba: That's funny, they don't have problems like this in other industrialized countries. Of course, other industrialized countries have universal health care. In the end, we all pick up the tab for injuries over $500k anyway, because uninsured persons get care through Medicaid - after they deplete all their financial resources and become wards of the state. Might as well have a system in place to pay for it, but make it open to public oversight.

Finally, one commenter wondered what the unintended consequences might be of shining light on the MCCA.

dwbanaszak: The current proposal represents a 17% increase, which maybe the largest proposed increase percentage wise, and I too would like to know the reason. But more importantly, I’d like to know why the association of insurers (MCCA) was exempted by the legislators that enacted the Insurance Code, FOIA and the OMA from public scrutiny. What unintended consequences await this ham-fisted attempt to broach a wall purposely created by former legislators?

Jen Eyer is the statewide community engagement director for Reach her at Follow her on Twitter @jeneyer.