Bill Text: MI SB1218 | 2017-2018 | 99th Legislature | Introduced

---

Bill Title: Insurance; automobile; mandatory automobile insurance; eliminate, and revise handling of catastrophic claims. Amends title & secs. 1910, 2102, 2103, 2118, 2120, 3009, 3017, 3020, 3037, 3101, 3102, 3103, 3104, 3131, 3135, 3163, 3171, 3172, 3179, 3303, 4501 & 6107 of 1956 PA 218 (MCL 500.1910 et seq.) & adds secs. 2112a, 3104a, 3104b & 3104c & ch. 63. TIE BAR WITH: SB 1212'18, SB 1213'18, SB 1214'18, SB 1215'18, SB 1216'18, SB 1217'18

Spectrum: Partisan Bill (Republican 1-0)

Status: (Introduced - Dead) 2018-11-27 - Referred To Committee On Insurance [SB1218 Detail]

Download: Michigan-2017-SB1218-Introduced.html

---

 

 

 

 

 

 

 

 

 

 

 

 

 

SENATE BILL No. 1218

 

 

November 27, 2018, Introduced by Senator COLBECK and referred to the Committee on Insurance.

 

 

 

     A bill to amend 1956 PA 218, entitled

 

"The insurance code of 1956,"

 

by amending the title and sections 1910, 2102, 2103, 2118, 2120,

 

3009, 3017, 3020, 3037, 3101, 3102, 3103, 3104, 3131, 3135, 3163,

 

3171, 3172, 3179, 3303, 4501, and 6107 (MCL 500.1910, 500.2102,

 

500.2103, 500.2118, 500.2120, 500.3009, 500.3017, 500.3020,

 

500.3037, 500.3101, 500.3102, 500.3103, 500.3104, 500.3131,

 

500.3135, 500.3163, 500.3171, 500.3172, 500.3179, 500.3303,

 

500.4501, and 500.6107), the title as amended by 2002 PA 304,

 

sections 1910, 3171, and 3172 as amended by 2012 PA 204, section

 

2103 as amended by 2016 PA 449, sections 2118 and 2120 as amended

 

by 2007 PA 35, sections 3009 and 3037 as amended and section 3017

 

as added by 2016 PA 346, section 3020 as amended by 2006 PA 106,

 

section 3101 as amended by 2017 PA 140, section 3102 as amended by

 

1990 PA 79, section 3103 as amended by 1986 PA 173, section 3104 as

 

amended by 2002 PA 662, section 3135 as amended by 2012 PA 158,

 

section 3163 as amended by 2002 PA 697, section 3303 as amended by

 

1980 PA 461, section 4501 as amended by 2012 PA 39, and section

 

6107 as amended by 2017 PA 58, and by adding sections 2112a, 3104a,

 

3104b, and 3104c and chapter 63.

 

THE PEOPLE OF THE STATE OF MICHIGAN ENACT:

 

TITLE

 

     An act to revise, consolidate, and classify the laws relating

 

to the insurance and surety business; to regulate the incorporation

 

or formation of domestic insurance and surety companies and

 

associations and the admission of foreign and alien companies and

 

associations; to provide their rights, powers, and immunities and

 

to prescribe the conditions on which companies and associations

 

organized, existing, or authorized under this act may exercise

 

their powers; to provide the rights, powers, and immunities and to

 

prescribe the conditions on which other persons, firms,

 

corporations, associations, risk retention groups, and purchasing

 

groups engaged in an insurance or surety business may exercise

 

their powers; to provide for the imposition of a privilege fee on

 

domestic insurance companies and associations; and the state

 

accident fund; to provide for the imposition of a tax on the

 

business of foreign and alien companies and associations; to

 

provide for the imposition of a tax on risk retention groups and

 

purchasing groups; to provide for the imposition of a tax on the

 

business of surplus line agents; to provide for the imposition of

 

regulatory fees on certain insurers; to provide for assessment fees

 

on certain health maintenance organizations; to modify tort

 

liability arising out of certain accidents; to provide for limited

 

actions with respect to that modified tort liability and to

 

prescribe certain procedures for maintaining those actions; to

 

require security for losses arising out of certain accidents; to

 

provide for the continued availability and affordability of

 

automobile insurance and homeowners insurance in this state and to

 

facilitate the purchase of that insurance by all residents of this

 

state at fair and reasonable rates; to provide for certain

 

reporting with respect to insurance and with respect to certain

 

claims against uninsured or self-insured persons; to prescribe

 

duties for certain state departments and officers with respect to

 

that reporting; to provide for certain assessments; to establish

 

and continue certain state insurance funds; to modify and clarify

 

the status, rights, powers, duties, and operations of the nonprofit

 

malpractice insurance fund; to provide for the departmental

 

supervision and regulation of the insurance and surety business

 

within this state; to provide for regulation over of worker's

 

compensation self-insurers; to provide for the conservation,

 

rehabilitation, or liquidation of unsound or insolvent insurers; to

 

provide for the protection of policyholders, claimants, and

 

creditors of unsound or insolvent insurers; to provide for

 

associations of insurers to protect policyholders and claimants in

 

the event of insurer insolvencies; to prescribe educational

 

requirements for insurance agents and solicitors; to provide for

 

the regulation of multiple employer welfare arrangements; to create

 

an automobile theft prevention authority 1 or more authorities to

 

reduce insurance fraud and the number of automobile thefts in this

state ; and to prescribe the powers and duties of the automobile

 

theft prevention authority; authorities; to provide certain for the

 

powers and duties upon of certain officials, departments, and

 

authorities of this state; to provide for an appropriation; to

 

repeal acts and parts of acts; and to provide penalties for the

 

violation of this act.

 

     Sec. 1910. (1) Insurance A licensee shall not be placed by a

 

licensee place insurance with an unauthorized insurer if coverage

 

is available from an authorized insurer.

 

     (2) There is a rebuttable presumption that the following

 

coverages are available from an authorized insurer:

 

     (a) No-fault Before July 1, 2020, no-fault automobile

 

insurance, as required by section 3101, which that is not written

 

for a person who is self-insuring motor vehicles under section

 

3101d.

 

     (b) Automobile liability or motor vehicle liability insurance.

 

     (c) (b) Private passenger automobile physical damage coverage.

 

     (d) (c) Homeowners and property insurance on owner-occupied

 

dwellings, the value of which is less than the maximum limits of

 

coverage that are available for the property under the general

 

rules of the Michigan basic property insurance association.Basic

 

Property Insurance Association.

 

     (e) (d) Any coverage readily available from 3 or more

 

authorized insurers, unless the authorized insurers quote a premium

 

and terms not competitive with the premium and terms quoted by an

 

unauthorized insurer.

 

     (f) (e) Worker's compensation insurance that is not written

for an employer that is partially self-insured under section 611 of

 

the worker's disability compensation act of 1969, 1969 PA 317, MCL

 

418.611.

 

     (3) There is a rebuttable presumption that the following

 

coverages are unavailable from an authorized insurer:

 

     (a) Coverages with respect to which 1 portion of the risk is

 

acceptable to authorized insurers, but another portion of the same

 

risk is not acceptable. The entire coverage may be placed with

 

eligible unauthorized insurers if it can be shown that eligible

 

unauthorized insurers will accept the entire coverage but not the

 

rejected portion alone.

 

     (b) Any coverage that the licensee is unable to procure after

 

diligent search among authorized insurers.

 

     (4) The commissioner director shall maintain, on a current

 

basis, a list of those lines of insurance for which coverages are

 

determined by the commissioner director to be generally unavailable

 

in the authorized insurance market. Any person may request in

 

writing that the commissioner director add or remove a coverage

 

from the current list. The commissioner director shall grant or

 

deny a request within 30 days after receiving the written request.

 

The commissioner director shall encourage dissemination of

 

information regarding the availability of coverages for which the

 

public interest necessitates additions to or deletions from the

 

list. The list shall must be published at least quarterly and shall

 

be revised as required. The commissioner director shall make the

 

list available to all licensees and other members of the public,

 

upon on request.

     Sec. 2102. (1) "Affiliate of", or an insurer "affiliated with"

 

an insurer, means an insurer that directly, or indirectly through 1

 

or more intermediaries, controls, or is controlled by, or is under

 

common control with the insurer specified.

 

     (2) "Automobile insurance" means insurance for private

 

passenger nonfleet automobiles which provides any of the following:

 

     (a) Automobile liability or motor vehicle liability insurance.

 

     (b) (a) Security required pursuant to under section 3101.

 

     (c) (b) Personal protection, property protection, and residual

 

liability insurance for amounts in excess of the amounts required

 

under chapter 31.

 

     (d) (c) Insurance coverages customarily known as comprehensive

 

and collision.

 

     (e) (d) Other insurance coverages for a private passenger

 

nonfleet automobile as prescribed by rule promulgated by the

 

commissioner pursuant to Act No. 306 of the Public Acts of 1969, as

 

amended, being sections director under the administrative

 

procedures act of 1969, 1969 PA 306, MCL 24.201 to 24.315 of the

 

Michigan Compiled Laws. A 24.328. The director shall transmit in

 

advance a rule proposed for promulgation by the commissioner

 

pursuant to under this section shall be transmitted in advance to

 

each member of the standing committee committees in the house and

 

in the senate which has with jurisdiction over insurance.

 

     (3) "Automobile insurance package policy" means a policy which

 

that includes more than 1 of the automobile insurance coverages

 

described in section 2102(2)(a), (b), (c), or (d), subsection (2)

 

in any combination.

     (4) "Declination" means any of the following:

 

     (a) Refusal by an agent to submit an application on behalf of

 

an applicant to any of the insurers represented by the agent.

 

     (b) Refusal by an insurer to issue insurance to a person upon

 

on receipt of an application for insurance.

 

     (c) Offering insurance at higher rates with a different

 

insurer than that requested by a person.

 

     (d) Offering coverage with less favorable terms or conditions

 

than those requested by a person.

 

     Sec. 2103. (1) "Eligible person", for automobile insurance,

 

means a person who is an owner or registrant of an automobile

 

registered or to be registered in this state or who holds a valid

 

license to operate a motor vehicle issued by this state, but does

 

not include any of the following:

 

     (a) A person who is not required to maintain security under

 

section 3101, unless the person intends to reside in this state for

 

30 days or more and makes a written statement of that intention on

 

a form approved by the director.

 

     (a) (b) A person whose license to operate a vehicle is under

 

suspension or revocation.

 

     (b) (c) A person who has been convicted within the immediately

 

preceding 5-year period of fraud or intent to defraud involving an

 

insurance claim or an application for insurance; or an individual

 

who has been successfully denied, within the immediately preceding

 

5-year period, payment by an insurer of a claim in excess of

 

$1,000.00 under an automobile insurance policy, if there is

 

evidence of fraud or intent to defraud involving an insurance claim

or application.

 

     (c) (d) A person who, during the immediately preceding 3-year

 

period, has been convicted under, or who has been subject to an

 

order of disposition of the family division of circuit court for a

 

violation of, any of the following:

 

     (i) Section 601d of the Michigan vehicle code, 1949 PA 300,

 

MCL 257.601d, or any other law of this state the violation of which

 

constitutes a felony resulting from the operation of a motor

 

vehicle.

 

     (ii) Section 625 of the Michigan vehicle code, 1949 PA 300,

 

MCL 257.625.

 

     (iii) Section 617, 617a, 618, or 619 of the Michigan vehicle

 

code, 1949 PA 300, MCL 257.617, 257.617a, 257.618, and 257.619.

 

     (iv) Section 626 of the Michigan vehicle code, 1949 PA 300,

 

MCL 257.626; or a similar violation under the laws of any other

 

state or a municipality in or outside of this state.

 

     (d) (e) A person whose vehicle insured or to be insured under

 

the policy fails to meet the motor vehicle safety requirements of

 

sections 683 to 711 of the Michigan vehicle code, 1949 PA 300, MCL

 

257.683 to 257.711.

 

     (e) (f) A person whose policy of automobile insurance has been

 

canceled because of nonpayment of premium or financed premium

 

within the immediately preceding 2-year period, unless the premium

 

due on a policy for which application has been made is paid in full

 

before issuance or renewal of the policy.

 

     (f) (g) A person who fails to obtain or maintain membership in

 

a club, group, or organization, if membership is a uniform

requirement of the insurer as a condition of providing insurance,

 

and if the dues, charges, or other conditions for membership are

 

applied uniformly throughout this state, are not expressed as a

 

percentage of premium, and do not vary with respect to the rating

 

classification of the member except for the purpose of offering a

 

membership fee to family units. Membership fees may vary in

 

accordance with the amount or type of coverage if the purchase of

 

additional coverage, either as to type or amount, is not a

 

condition for reduction of dues or fees.

 

     (g) (h) A person whose driving record for the 3-year period

 

immediately preceding application for or renewal of a policy, has,

 

under section 2119a, an accumulation of more than 6 insurance

 

eligibility points.

 

     (2) "Eligible person", for home insurance, means a person who

 

is the owner-occupant or tenant of a dwelling of any of the

 

following types: a house, a condominium unit, a cooperative unit, a

 

room, or an apartment; or a person who is the owner-occupant of a

 

multiple unit dwelling of not more than 4 residential units.

 

Eligible person does not include any of the following:

 

     (a) A person who has been convicted, in the immediately

 

preceding 5-year period, of 1 or more of the following:

 

     (i) Arson, or conspiracy to commit arson.

 

     (ii) A crime under sections 72 to 77, 112, 211a, 377a, 377b,

 

or 380 of the Michigan penal code, 1931 PA 328, MCL 750.72 to

 

750.77, 750.112, 750.211a, 750.377a, 750.377b, and 750.380.

 

     (iii) A crime under section 92, 151, 157b, or 218 of the

 

Michigan penal code, 1931 PA 328, MCL 750.92, 750.151, 750.157b,

and 750.218, based on a crime described in subparagraph (ii)

 

committed by or on behalf of the person.

 

     (b) A person who has been successfully denied, within the

 

immediately preceding 5-year period, payment by an insurer of a

 

claim under a home insurance policy based on evidence of arson,

 

conspiracy to commit arson, fraud, or conspiracy to commit fraud,

 

committed by or on behalf of the person.

 

     (c) A person who insures or seeks to insure a dwelling that is

 

being used for an illegal or demonstrably hazardous purpose.

 

     (d) A person who refuses to purchase an amount of insurance

 

equal to at least 80% of the replacement cost of the property

 

insured or to be insured under a replacement cost policy.

 

     (e) A person who refuses to purchase an amount of insurance

 

equal to at least 100% of the market value of the property insured

 

or to be insured under a repair cost policy.

 

     (f) A person who refuses to purchase an amount of insurance

 

equal to at least 100% of the actual cash value of the property

 

insured or to be insured under a tenant or renter's home insurance

 

policy.

 

     (g) A person whose policy of home insurance has been canceled

 

because of nonpayment of premium within the immediately preceding

 

2-year period, unless the premium due on the policy is paid in full

 

before issuance or renewal of the policy.

 

     (h) A person who insures or seeks to insure a dwelling, if the

 

insured value is not any of the following:

 

     (i) For a repair cost policy, at least $15,000.00.

 

     (ii) For a replacement policy, at least $35,000.00 or another

amount established by the director. The director may establish an

 

amount under this subparagraph biennially by a rule promulgated

 

under the administrative procedures act of 1969, 1969 PA 306, MCL

 

24.201 to 24.328, and based on changes in applicable construction

 

cost indices.

 

     (i) A person who insures or seeks to insure a dwelling that

 

has physical conditions that clearly present an extreme likelihood

 

of a significant loss under a home insurance policy.

 

     (j) A person whose real property taxes with respect to the

 

dwelling insured or to be insured have been and are delinquent for

 

2 or more years at the time of renewal of, or application for, home

 

insurance.

 

     (k) A person who has failed to procure or maintain membership

 

in a club, group, or organization, if membership is a uniform

 

requirement of the insurer, and if the dues, charges, or other

 

conditions for membership are applied uniformly throughout this

 

state, are not expressed as a percentage of premium, and do not

 

vary with respect to the rating classification of the member except

 

for the purpose of offering a membership fee to family units.

 

Membership fees may vary in accordance with the amount or type of

 

coverage if the purchase of additional coverage, either as to type

 

or amount, is not a condition for reduction of dues or fees.

 

     (3) "Home insurance" means any of the following, but does not

 

include insurance intended to insure commercial, industrial,

 

professional, or business property, obligations, or liabilities:

 

     (a) Fire insurance for an insured's dwelling of a type

 

described in subsection (2).

     (b) If contained in or indorsed to a fire insurance policy

 

providing insurance for the insured's residence, other insurance

 

intended primarily to insure nonbusiness property, obligations, and

 

liabilities.

 

     (c) Other insurance coverages for an insured's residence as

 

prescribed by rule promulgated by the director under the

 

administrative procedures act of 1969, 1969 PA 306, MCL 24.201 to

 

24.328. The director shall transmit a rule proposed for

 

promulgation under this section in advance to each member of the

 

standing committees in the house of representatives and the senate

 

that have jurisdiction over insurance.

 

     (4) "Insurance eligibility points" means all of the following:

 

     (a) Points calculated, according to the following schedule,

 

for convictions, determinations of responsibility for civil

 

infractions, or findings of responsibility in probate court:

 

     (i) For a violation of any lawful speed limit by more than 15

 

miles per hour, or careless driving, 4 points.

 

     (ii) For a violation of any lawful speed limit by more than 10

 

miles per hour but less than 16 miles per hour, 3 points.

 

     (iii) For a violation of any lawful speed limit by more than 5

 

miles per hour but less than 11 miles per hour, 2 points.

 

     (iv) For a violation of any speed limit by more than 5 miles

 

per hour but less than 16 miles per hour on a roadway that had a

 

lawfully posted maximum speed of 70 miles per hour or greater as of

 

January 1, 1974, 2 points.

 

     (v) For a violation of a speed limit by less than 6 miles per

 

hour, 1 point.

     (vi) For all other moving violations pertaining to the

 

operation of motor vehicles, 2 points.

 

     (b) Points calculated, according to the following schedule,

 

for determinations that the person was substantially at-fault:

 

     (i) For the first substantially at-fault accident, 3 points.

 

     (ii) For the second and each subsequent substantially at-fault

 

accident, 4 points.

 

     (5) "Insurer" means an insurer authorized to transact in this

 

state the kind or combination of kinds of insurance constituting

 

automobile insurance or home insurance.

 

     Sec. 2112a. (1) The director shall develop, or cause to be

 

developed, and use a consumer information system that will provide

 

and disseminate price, benefit, and other relevant information on a

 

readily available basis to purchasers of automobile insurance for

 

personal, family, or household needs.

 

     (2) The development and use of a consumer information system

 

under this section may be conducted internally within the

 

department, in cooperation with the insurance departments of other

 

states, through outside contractors, or in any other appropriate

 

manner.

 

     (3) To the extent the director determines it is necessary and

 

appropriate, insurers, advisory organizations, statistical agents,

 

and other persons involved in conducting the business of insurance

 

in this state, to which this section applies, shall cooperate in

 

the development and use of the consumer information system under

 

this section.

 

     Sec. 2118. (1) As a condition of maintaining its certificate

of authority, an insurer shall not refuse to insure, refuse to

 

continue to insure, or limit coverage available to an eligible

 

person for automobile insurance, except in accordance with

 

underwriting rules established pursuant to as provided in this

 

section and sections 2119 and 2120.

 

     (2) The underwriting rules that an insurer may establish for

 

automobile insurance shall must be based only on the following:

 

     (a) Criteria identical to the standards set forth in section

 

2103(1).

 

     (b) The insurance eligibility point accumulation in excess of

 

the amounts established by section 2103(1) of a member of the

 

household of the eligible person insured or to be insured, if the

 

member of the household usually accounts for 10% or more of the use

 

of a vehicle insured or to be insured. For purposes of this

 

subdivision, there is a rebuttable presumption that a person who is

 

the principal driver for 1 automobile insurance policy shall be

 

rebuttably presumed does not to usually account for more than 10%

 

of the use of other vehicles another vehicle of the household that

 

is not insured under the policy of that the person.

 

     (c) With respect to a vehicle insured or to be insured,

 

substantial modifications from the vehicle's original manufactured

 

state for purposes of increasing the speed or acceleration

 

capabilities of the vehicle.

 

     (d) Except as otherwise provided in section 2116a, failure by

 

the person to provide proof that insurance required by section 3101

 

was maintained in force with respect to any vehicle that was both

 

owned by the person and driven or moved by the person or by a

member of the household of the person during the 6-month period

 

immediately preceding application. Such proof shall take the form

 

of a certification by the person on a form provided by the insurer

 

that the vehicle was not driven or moved without maintaining the

 

insurance required by section 3101 during the 6-month period

 

immediately preceding application.

 

     (d) (e) Type of vehicle insured or to be insured, based on 1

 

of the following, without regard to the age of the vehicle:

 

     (i) The vehicle is being of limited production or of custom

 

manufacture.

 

     (ii) The insurer does not have having a rate lawfully in

 

effect for the type of vehicle.

 

     (iii) The vehicle represents representing exposure to

 

extraordinary expense for repair or replacement under comprehensive

 

or collision coverage.

 

     (e) (f) Use of a vehicle insured or to be insured for

 

transportation of passengers for hire, for rental purposes, or for

 

commercial purposes. Rules under this subdivision shall must not be

 

based on the use of a vehicle for volunteer or charitable purposes

 

or for which reimbursement for normal operating expenses is

 

received.

 

     (f) (g) Payment of a minimum deposit at the time of

 

application or renewal, not to exceed the smallest deposit required

 

under an extended payment or premium finance plan customarily used

 

by the insurer.

 

     (g) (h) For purposes of requiring comprehensive deductibles of

 

not more than $150.00, or of refusing to insure if the person

refuses to accept a required deductible, the claim experience of

 

the person with respect to comprehensive coverage.

 

     (h) (i) Total abstinence from the consumption of alcoholic

 

beverages except if such the beverages are consumed as part of a

 

religious ceremony. However, an insurer shall not utilize an

 

underwriting rule based on this subdivision unless the insurer has

 

been was authorized to transact automobile insurance in this state

 

prior to before January 1, 1981, and has consistently utilized such

 

an underwriting rule as part of the insurer's automobile insurance

 

underwriting since being authorized to transact automobile

 

insurance in this state.

 

     (i) (j) One or more incidents involving a threat, harassment,

 

or physical assault by the insured or applicant for insurance on an

 

insurer employee, agent, or agent employee while acting within the

 

scope of his or her employment so long as if a report of the

 

incident was filed with an appropriate law enforcement agency.

 

     Sec. 2120. (1) Affiliated insurers may establish underwriting

 

rules so that each affiliate will provide automobile insurance only

 

to certain eligible persons. This subsection shall apply applies

 

only if an eligible person can obtain automobile insurance from 1

 

of the affiliates. The underwriting rules shall be in compliance

 

must comply with this section and sections 2118 and 2119.

 

     (2) An insurer may establish separate rating plans so that

 

certain eligible persons are provided automobile insurance under 1

 

rating plan and other eligible persons are provided automobile

 

insurance under another rating plan. This subsection shall apply

 

applies only if all eligible persons can obtain automobile

insurance under a rating plan of the insurer. Underwriting The

 

insurer shall establish underwriting rules consistent with this

 

section and sections 2118 and 2119 shall be established to define

 

the rating plan applicable to each eligible person.

 

     (3) Underwriting rules under this section shall must be based

 

only on the following:

 

     (a) With respect to a vehicle insured or to be insured,

 

substantial modifications from the vehicle's original manufactured

 

state for purposes of increasing the speed or acceleration

 

capabilities of the vehicle.

 

     (b) Except as otherwise provided in section 2116a, failure of

 

the person to provide proof that insurance required by section 3101

 

was maintained in force with respect to any vehicle owned and

 

operated by the person or by a member of the household of the

 

person during the 6-month period immediately preceding application

 

or renewal of the policy. Such proof shall take the form of a

 

certification by the person that the required insurance was

 

maintained in force for the 6-month period with respect to such

 

vehicle.

 

     (b) (c) For purposes of insuring persons who have refused a

 

deductible lawfully required under section 2118(2)(h), 2118(2)(g),

 

the claim experience of the person with respect to comprehensive

 

coverage.

 

     (c) (d) Refusal of the person to pay a minimum deposit

 

required under section 2118(2)(g).2118(2)(f).

 

     (d) (e) A person's insurance eligibility point accumulation

 

under section 2103(1)(h), 2103(1)(g), or the total insurance

eligibility point accumulation of all persons who account for 10%

 

or more of the use of 1 or more vehicles insured or to be insured

 

under the policy.

 

     (e) (f) The type of vehicle insured or to be insured as

 

provided in section 2118(2)(e).2118(2)(d).

 

     Sec. 3009. (1) An automobile liability or motor vehicle

 

liability policy insuring against loss resulting from liability

 

imposed by law for property damage, bodily injury, or death

 

suffered by any person arising out of the ownership, maintenance,

 

or use of a motor vehicle shall not be delivered or issued for

 

delivery in this state with respect to any motor vehicle registered

 

or principally garaged in this state unless the liability coverage

 

is subject to all of the following limits:

 

     (a) A limit, exclusive of interest and costs, of not less than

 

$20,000.00 because of bodily injury to or death of 1 person in any

 

1 accident.

 

     (b) Subject to the limit for 1 person in subdivision (a), a

 

limit of not less than $40,000.00 because of bodily injury to or

 

death of 2 or more persons in any 1 accident.

 

     (c) A limit of not less than $10,000.00 because of injury to

 

or destruction of property of others in any accident.

 

     (2) If authorized by the insured, automobile liability or

 

motor vehicle liability coverage may be excluded when a vehicle is

 

operated by a named person. An exclusion under this subsection is

 

not valid unless the following notice is on the face of the policy

 

or the declaration page or certificate of the policy and on the

 

certificate of insurance:

     Warning—when a named excluded person operates a vehicle all

 

liability coverage is void—no one is insured. Owners of the vehicle

 

and others legally responsible for the acts of the named excluded

 

person remain fully personally liable.

 

     (3) A liability policy described in subsection (1) may exclude

 

coverage for liability as provided in section 3017.

 

     (4) If an insurer deletes coverages from an automobile

 

insurance policy pursuant to section 3101, the insurer shall send

 

documentary evidence of the deletion to the insured.After June 30,

 

2020, an insurer shall not issue or renew with respect to a motor

 

vehicle registered or principally garaged in this state an

 

automobile insurance policy that provides security for payment of

 

benefits under personal protection insurance or property protection

 

insurance under chapter 31.

 

     Sec. 3017. (1) An authorized insurer that issues an insurance

 

policy insuring a personal vehicle may exclude all coverage

 

afforded under the policy for any loss or injury that occurs while

 

a transportation network company driver is logged on to a

 

transportation network company digital network or while a

 

transportation network company driver is providing a transportation

 

network company prearranged ride. By way of example and not as

 

limitation, all of the following coverages may be excluded under

 

this section:

 

     (a) Residual liability insurance required under sections 3009

 

and or 3101.

 

     (b) Personal protection and property protection insurance

 

required under section 3101.

     (c) Uninsured and underinsured motorist coverage.

 

     (d) Comprehensive coverage.

 

     (e) Collision coverage, including coverage required to be

 

offered under section 3037.

 

     (2) This section does not require an automobile insurance

 

policy to provide coverage under any of the following

 

circumstances:

 

     (a) While a transportation network company driver is logged on

 

to a transportation network company digital network.

 

     (b) While a transportation network company driver is engaged

 

in providing a transportation network company prearranged ride.

 

     (c) While a transportation network company driver otherwise

 

uses a vehicle to transport passengers for compensation.

 

     (3) This section does not preclude an insurer from providing

 

coverage for a transportation network company driver's personal

 

vehicle by contract or endorsement.

 

     (4) An insurer that excludes the coverage described in

 

subsection (1) does not have a duty to defend or indemnify for any

 

claim that is expressly excluded. This section does not invalidate

 

or limit an exclusion contained in a policy, including a policy in

 

use or approved for use in this state before the effective date of

 

this section, March 21, 2017, that excludes coverage for vehicles

 

that are used to carry individuals or property for a charge or that

 

are available for hire by the public. An insurer that defends or

 

indemnifies for a claim against a transportation network company

 

driver who is excluded under the terms of the policy has a right of

 

contribution against other insurers that provided automobile

insurance to the transportation network company driver in

 

satisfaction of the coverage requirements of section 23 of the

 

limousine, taxicab, and transportation network company act, 2016 PA

 

345, MCL 257.2123, at the time of the loss.

 

     (5) An insurer that provides automobile insurance to a

 

transportation network company shall comply with section 23(5),

 

(6), and (9) of the limousine, taxicab, and transportation network

 

company act, 2016 PA 345, MCL 257.2123.

 

     (6) During an investigation of whether a claim is covered

 

under an insurance policy, a transportation network company and any

 

insurer that provides coverage under section 23 of the limousine,

 

taxicab, and transportation network company act, 2016 PA 345, MCL

 

257.2123, shall cooperate to facilitate the exchange of relevant

 

information with persons who are directly involved and any insurer

 

of the transportation network company driver. Relevant information

 

required to be exchanged under this subsection includes, but is not

 

limited to, all of the following:

 

     (a) The times that the transportation network company driver

 

logged on to and logged off of the transportation network company

 

digital network during the 12 hours preceding the accident and the

 

12 hours following the accident.

 

     (b) A clear description of the coverage, exclusions, and

 

limits under any insurance policy maintained as required by section

 

23 of the limousine, taxicab, and transportation network company

 

act, 2016 PA 345, MCL 257.2123.

 

     (7) As used in this section, all of the following terms mean

 

those terms as defined in section 2 of the limousine, taxicab, and

transportation network company act, 2016 PA 345, MCL 257.2102:

 

     (a) "Personal vehicle".

 

     (b) "Prearranged ride".

 

     (b) (c) "Transportation network company".

 

     (c) (d) "Transportation network company digital network".

 

     (d) (e) "Transportation network company driver".

 

     (e) "Transportation network company prearranged ride".

 

     Sec. 3020. (1) A An authorized insurer shall not issue or

 

deliver in this state a policy of casualty insurance, except not

 

including worker's compensation and mortgage guaranty insurance,

 

but including all classes of motor vehicle coverage, shall not be

 

issued or delivered in this state by an insurer authorized to do

 

business in this state for which a premium or advance assessment is

 

charged , unless the policy contains the following provisions:

 

     (a) That Except as otherwise provided in subsections (2) and

 

(3), that the policy may be canceled at any time at the request of

 

the insured, in which case the insurer shall will refund the excess

 

of paid premium or assessment above the pro rata rates for the

 

expired time. , except as otherwise provided in subsections (2),

 

(3), and (4).

 

     (b) Except as otherwise provided in subdivision (d), that the

 

policy may be canceled at any time by the insurer by mailing to the

 

insured at the insured's address last known to the insurer or an

 

authorized agent of the insurer, with postage fully prepaid, a not

 

less than 10 days' written notice of cancellation with or without

 

tender of the excess of paid premium or assessment above the pro

 

rata premium for the expired time.

     (c) That the minimum earned premium on any policy canceled

 

pursuant to under this subsection, other than automobile insurance

 

as defined in section 2102(2)(a), and (b), shall and (c), will not

 

be less than the pro rata premium for the expired time or $25.00,

 

whichever is greater.

 

     (d) That an insurer may refuse to renew a malpractice

 

insurance policy only by mailing to the insured at the insured's

 

address last known to the insurer or an authorized agent of the

 

insurer, with postage fully prepaid, a not less than 60 days'

 

written notice of refusal to renew. As used in this subdivision,

 

"malpractice insurance" means malpractice insurance as described in

 

section 624(1)(h).

 

     (2) An insurer may file a rule with the commissioner director

 

providing for a minimum retention of premium for automobile

 

insurance as defined in section 2102(2)(a), and (b), and (c). The

 

rule shall must describe the circumstances under which the

 

retention is applied and shall set forth the amount to be retained,

 

which is subject to the approval of the commissioner. director. The

 

rule shall must include, but need not be limited to, the following

 

provisions:

 

     (a) That a minimum retention shall will be applied only when

 

the amount exceeds the amount that would have been retained had the

 

policy been canceled on a pro rata basis.

 

     (b) That a minimum retention does not apply to renewal

 

policies.

 

     (c) That a minimum retention does not apply when a policy is

 

canceled for the following reasons:

     (i) The insured is no longer required to maintain security

 

pursuant to section 3101(1).

 

     (ii) The because the insured has replaced the automobile

 

insurance policy being canceled with an automobile insurance policy

 

from another insurer and provides proof of the replacement coverage

 

to the canceling insurer.

 

     (3) Notwithstanding subsection (1), an insurer may issue a

 

noncancelable, nonrefundable, 6-month prepaid automobile insurance

 

policy in order for an insured to meet the registration

 

requirements of section 227a of the Michigan vehicle code, 1949 PA

 

300, MCL 257.227a.

 

     (3) (4) An insurer may provide for a short rate premium for

 

insurance on a motorcycle, watercraft, off-road vehicle, or

 

snowmobile. As used in this subsection:

 

     (a) "Motorcycle" means that term as defined in section 3101.

 

     (b) "Off-road vehicle" means an ORV as defined in section

 

81101 of the natural resources and environmental protection act,

 

1994 PA 451, MCL 324.81101.

 

     (c) "Snowmobile" means that term as defined in section 82101

 

of the natural resources and environmental protection act, 1994 PA

 

451, MCL 324.82101.

 

     (d) "Watercraft" means that term as defined in section 80301

 

of the natural resources and environmental protection act, 1994 PA

 

451, MCL 324.80301.

 

     (4) (5) Cancellation as prescribed in this section is without

 

prejudice to any claim originating before the cancellation. The

 

mailing of notice is prima facie proof of notice. Delivery of

written notice is equivalent to mailing.

 

     (6) A notice of cancellation, including a cancellation notice

 

under section 3224, shall be accompanied by a statement that the

 

insured shall not operate or permit the operation of the vehicle to

 

which notice of cancellation is applicable, or operate any other

 

vehicle, unless the vehicle is insured as required by law.

 

     (5) (7) An insurer who wishes to provide for a short rate

 

premium under subsection (4) (3) shall file with the commissioner

 

pursuant to director as provided in chapter 24 or 26 a rule

 

establishing a short rate premium. The rule shall must describe the

 

circumstances under which the short rate is applied and shall set

 

forth the amount or percentage to be retained.

 

     Sec. 3037. (1) At the time a new applicant for the insurance

 

required by section 3101 or automobile insurance for a private

 

passenger nonfleet automobile makes an initial written application

 

to the an insurer, an the insurer shall offer both of the following

 

collision coverages to the applicant:

 

     (a) Limited collision coverage, which must pay for collision

 

damage to the insured vehicle without a deductible amount if the

 

operator of the vehicle is not substantially at fault in the

 

accident from which the damage arose.

 

     (b) Broad form collision coverage, which must pay for

 

collision damage to the insured vehicle regardless of fault, with

 

deductibles in the amounts as approved by the director, which

 

deductibles must be waived if the operator of the vehicle is not

 

substantially at fault in the accident from which the damage arose.

 

     (2) In addition to the coverages offered under subsection (1),

an insurer may offer standard and limited collision coverage may be

 

offered with deductibles as approved by the director.

 

     (3) An insurer may limit collision coverage offered under this

 

section as provided in section 3017.

 

     (4) If the an applicant is required by the an insurer to sign

 

the a written application form described in subsection (1), and if

 

the applicant chooses to reject both of the collision coverages, or

 

limited collision without a deductible, offered under subsection

 

(1), the rejection must be made in writing, either on a separate

 

form, as part of the application, or in some combination of these,

 

as approved by the director. The rejection statement must inform

 

the applicant of his or her rights if there is damage to the

 

insured vehicle under the alternative coverage option selected.

 

     (5) If a written application is made by mail, and if the

 

applicant fails to sign or return a written rejection statement as

 

required by subsection (4), the requirements of subsection (4) are

 

considered to be satisfied with respect to the insurer if all of

 

the following occur:

 

     (a) The application provides the applicant with an opportunity

 

to select the coverages required to be offered under subsection

 

(1).

 

     (b) The applicant is requested to sign the rejection

 

statement, either as part of the application or as a separate form

 

issued with the application, if the applicant fails to select

 

either of the coverages specified in subsection (1).

 

     (c) The applicant signed the application as otherwise required

 

by the insurer.

     (6) At the time of the an initial written application

 

described in subsection (1), an agent or insurer shall provide the

 

applicant with a written explanation of collision coverage options

 

in easily understandable language, if that the information is not

 

contained in the application form.

 

     (7) At least annually in conjunction with the renewal of a

 

private passenger nonfleet automobile insurance policy, or at the

 

time of an addition, deletion, or substitution of a vehicle under

 

an existing policy, other than a group policy, an insurer shall

 

inform the policyholder, on a form approved by the director, of all

 

of the following:

 

     (a) The current status of collision coverage, if any, for the

 

vehicle or vehicles affected by the renewal or change and the

 

rights of the insured under the current coverage if the vehicle is

 

damaged.

 

     (b) The collision coverages available under the policy and the

 

rights of the insured under each collision option if the vehicle is

 

damaged.

 

     (c) Procedures for the policyholder to follow if he or she

 

wishes to change the current collision coverage.

 

     (8) As used in this section:

 

     (a) "Collision damage" does not include losses customarily

 

insured under comprehensive coverages.

 

     (b) "Substantially at fault" means a person's action or

 

inaction was more than 50% of the cause of the accident.

 

     Sec. 3101. (1) The Before July 1, 2020, the owner or

 

registrant of a motor vehicle required to be registered in this

state shall maintain security for payment of benefits under

 

personal protection insurance, property protection insurance, and

 

residual liability insurance. Security under this subsection is

 

only required to be in effect during the period the motor vehicle

 

is driven or moved on a highway. Notwithstanding any other

 

provision in this act, an insurer that has issued an automobile

 

insurance policy on a motor vehicle that is not driven or moved on

 

a highway may allow the insured owner or registrant of the motor

 

vehicle to delete a portion of the coverages required by this

 

subsection under the policy and maintain the comprehensive coverage

 

portion of the policy in effect.

 

     (2) As used in this chapter:

 

     (a) "Automobile insurance" means that term as defined in

 

section 2102.

 

     (b) "Commercial quadricycle" means a vehicle to which all of

 

the following apply:

 

     (i) The vehicle has fully operative pedals for propulsion

 

entirely by human power.

 

     (ii) The vehicle has at least 4 wheels and is operated in a

 

manner similar to a bicycle.

 

     (iii) The vehicle has at least 6 seats for passengers.

 

     (iv) The vehicle is designed to be occupied by a driver and

 

powered either by passengers providing pedal power to the drive

 

train of the vehicle or by a motor capable of propelling the

 

vehicle in the absence of human power.

 

     (v) The vehicle is used for commercial purposes.

 

     (vi) The vehicle is operated by the owner of the vehicle or an

employee of the owner of the vehicle.

 

     (c) "Electric bicycle" means that term as defined in section

 

13e of the Michigan vehicle code, 1949 PA 300, MCL 257.13e.

 

     (d) "Golf cart" means a vehicle designed for transportation

 

while playing the game of golf.

 

     (e) "Highway" means highway or street as that term is defined

 

in section 20 of the Michigan vehicle code, 1949 PA 300, MCL

 

257.20.

 

     (f) "Moped" means that term as defined in section 32b of the

 

Michigan vehicle code, 1949 PA 300, MCL 257.32b.

 

     (g) "Motorcycle" means a vehicle that has a saddle or seat for

 

the use of the rider, is designed to travel on not more than 3

 

wheels in contact with the ground, and is equipped with a motor

 

that exceeds 50 cubic centimeters piston displacement. For purposes

 

of this subdivision, the wheels on any attachment to the vehicle

 

are not considered as wheels in contact with the ground. Motorcycle

 

does not include a moped or an ORV.

 

     (h) "Motorcycle accident" means a loss that involves the

 

ownership, operation, maintenance, or use of a motorcycle as a

 

motorcycle, but does not involve the ownership, operation,

 

maintenance, or use of a motor vehicle as a motor vehicle.

 

     (i) "Motor vehicle" means a vehicle, including a trailer, that

 

is operated or designed for operation on a public highway by power

 

other than muscular power and has more than 2 wheels. Motor vehicle

 

does not include any of the following:

 

     (i) A motorcycle.

 

     (ii) A moped.

     (iii) A farm tractor or other implement of husbandry that is

 

not subject to the registration requirements of the Michigan

 

vehicle code under section 216 of the Michigan vehicle code, 1949

 

PA 300, MCL 257.216.

 

     (iv) An ORV.

 

     (v) A golf cart.

 

     (vi) A power-driven mobility device.

 

     (vii) A commercial quadricycle.

 

     (viii) An electric bicycle.

 

     (j) "Motor vehicle accident" means a loss that involves the

 

ownership, operation, maintenance, or use of a motor vehicle as a

 

motor vehicle regardless of whether the accident also involves the

 

ownership, operation, maintenance, or use of a motorcycle as a

 

motorcycle.

 

     (k) "ORV" means a motor-driven recreation vehicle designed for

 

off-road use and capable of cross-country travel without benefit of

 

road or trail, on or immediately over land, snow, ice, marsh,

 

swampland, or other natural terrain. ORV includes, but is not

 

limited to, a multitrack or multiwheel drive vehicle, a motorcycle

 

or related 2-wheel, 3-wheel, or 4-wheel vehicle, an amphibious

 

machine, a ground effect air cushion vehicle, an ATV as defined in

 

section 81101 of the natural resources and environmental protection

 

act, 1994 PA 451, MCL 324.81101, or other means of transportation

 

deriving motive power from a source other than muscle or wind. ORV

 

does not include a vehicle described in this subdivision that is

 

registered for use on a public highway and has the security

 

required under subsection (1) or section 3103 in effect.

     (l) "Owner" means any of the following:

 

     (i) A person renting a motor vehicle or having the use of a

 

motor vehicle, under a lease or otherwise, for a period that is

 

greater than 30 days.

 

     (ii) A person renting a motorcycle or having the use of a

 

motorcycle under a lease for a period that is greater than 30 days,

 

or otherwise for a period that is greater than 30 consecutive days.

 

A person who borrows a motorcycle for a period that is less than 30

 

consecutive days with the consent of the owner is not an owner

 

under this subparagraph.

 

     (iii) A person that holds the legal title to a motor vehicle

 

or motorcycle, other than a person engaged in the business of

 

leasing motor vehicles or motorcycles that is the lessor of a motor

 

vehicle or motorcycle under a lease that provides for the use of

 

the motor vehicle or motorcycle by the lessee for a period that is

 

greater than 30 days.

 

     (iv) A person that has the immediate right of possession of a

 

motor vehicle or motorcycle under an installment sale contract.

 

     (m) "Power-driven mobility device" means a wheelchair or other

 

mobility device powered by a battery, fuel, or other engine and

 

designed to be used by an individual with a mobility disability for

 

the purpose of locomotion.

 

     (n) "Registrant" does not include a person engaged in the

 

business of leasing motor vehicles or motorcycles that is the

 

lessor of a motor vehicle or motorcycle under a lease that provides

 

for the use of the motor vehicle or motorcycle by the lessee for a

 

period that is longer than 30 days.

     (3) Security required by subsection (1) may be provided under

 

a policy issued by an authorized insurer that affords insurance for

 

the payment of benefits described in subsection (1). A policy of

 

insurance represented or sold as providing security is considered

 

to provide insurance for the payment of the benefits.

 

     (4) Security required by subsection (1) may be provided by any

 

other method approved by the secretary of state as affording

 

security equivalent to that afforded by a policy of insurance, if

 

proof of the security is filed and continuously maintained with the

 

secretary of state throughout the period the motor vehicle is

 

driven or moved on a highway. The person filing the security has

 

all the obligations and rights of an insurer under this chapter.

 

When the context permits, "insurer" as used in this chapter,

 

includes a person that files the security as provided in this

 

section.

 

     (5) An insurer that issues a policy that provides the security

 

required under subsection (1) may exclude coverage under the policy

 

as provided in section 3017.

 

     Sec. 3102. (1) A Before July 1, 2020, a nonresident owner or

 

registrant of a motor vehicle or motorcycle not registered in this

 

state shall not operate or permit the motor vehicle or motorcycle

 

to be operated in this state for an aggregate of more than 30 days

 

in any calendar year unless he or she continuously maintains

 

security for the payment of benefits pursuant to under this

 

chapter.

 

     (2) An owner or registrant of a motor vehicle or motorcycle

 

with respect to which security is required under this chapter, who

operates the motor vehicle or motorcycle or permits it to be

 

operated upon a public highway in this state, without having in

 

full force and effect security complying with this section or

 

section 3101 or 3103 is guilty of a misdemeanor. A person who

 

operates a motor vehicle or motorcycle upon on a public highway in

 

this state with the knowledge that the owner or registrant does not

 

have security in full force and effect as required under this

 

chapter is guilty of a misdemeanor . A person convicted of a

 

misdemeanor under this section shall be fined punishable by a fine

 

of not less than $200.00 nor and not more than $500.00 , imprisoned

 

or imprisonment for not more than 1 year, or both.

 

     (3) The failure of a person to produce evidence that a motor

 

vehicle or motorcycle has had in full force and effect security

 

complying with this section or section 3101 or 3103 on the date of

 

the issuance of the citation, creates a rebuttable presumption in a

 

prosecution under subsection (2) that the motor vehicle or

 

motorcycle did not have in full force and effect security complying

 

with this section or section 3101 or 3103 on the date of the

 

issuance of the citation.

 

     Sec. 3103. (1) An owner or registrant of a motorcycle shall

 

provide security against loss resulting from liability imposed by

 

law for property damage, bodily injury, or death suffered by a

 

person arising out of the ownership, maintenance, or use of that

 

the motorcycle. The security shall conform with must meet the

 

requirements of section 3009(1).

 

     (2) Each insurer transacting insurance in this state which

 

that affords coverage for a motorcycle as described in subsection

(1) also shall offer, to an owner or registrant of a motorcycle,

 

security for the payment of first-party medical benefits only, in

 

increments of $5,000.00, payable in the event if the owner or

 

registrant is involved in a motorcycle accident. An insurer

 

providing first-party medical benefits under this subsection may

 

offer, at appropriate premium rates, deductibles, provisions for

 

the coordination of these benefits, and provisions for the

 

subtraction of other benefits provided or required to be provided

 

under the laws of any state or the federal government, subject to

 

the prior approval of the commissioner. director. These deductibles

 

and provisions shall must apply only to benefits payable to the

 

person named in the policy, the spouse of the insured, and any

 

relative of either domiciled in the same household.

 

     (3) This section does not apply after June 30, 2020.

 

     Sec. 3104. (1) An The catastrophic claims association is

 

created as an unincorporated, nonprofit association. to be known as

 

the catastrophic claims association, hereinafter referred to as the

 

association, is created. Each Before July 1, 2020, each insurer

 

engaged in writing insurance coverages that provide the security

 

required by section 3101(1) within in this state, as a condition of

 

its authority to transact insurance in this state, shall be a

 

member of the association and shall be is bound by the plan of

 

operation of the association. Each Before July 1, 2020, an insurer

 

engaged in writing insurance coverages that provide the security

 

required by section 3103(1) within in this state, as a condition of

 

its authority to transact insurance in this state, shall be is

 

considered to be a member of the association, but only for purposes

of premiums under subsection (7)(d). Except as expressly provided

 

in this section, the association is not subject to any laws of this

 

state with respect to insurers, but in all other respects the

 

association is subject to the laws of this state to the extent that

 

the association would be if it were an insurer organized and

 

subsisting under chapter 50.

 

     (2) The Before July 1, 2020, the association shall provide and

 

each member shall accept indemnification for 100% of the amount of

 

ultimate loss sustained under personal protection insurance

 

coverages in excess of the following amounts in each loss

 

occurrence:

 

     (a) For a motor vehicle accident policy issued or renewed

 

before July 1, 2002, $250,000.00.

 

     (b) For a motor vehicle accident policy issued or renewed

 

during the period July 1, 2002 to June 30, 2003, $300,000.00.

 

     (c) For a motor vehicle accident policy issued or renewed

 

during the period July 1, 2003 to June 30, 2004, $325,000.00.

 

     (d) For a motor vehicle accident policy issued or renewed

 

during the period July 1, 2004 to June 30, 2005, $350,000.00.

 

     (e) For a motor vehicle accident policy issued or renewed

 

during the period July 1, 2005 to June 30, 2006, $375,000.00.

 

     (f) For a motor vehicle accident policy issued or renewed

 

during the period July 1, 2006 to June 30, 2007, $400,000.00.

 

     (g) For a motor vehicle accident policy issued or renewed

 

during the period July 1, 2007 to June 30, 2008, $420,000.00.

 

     (h) For a motor vehicle accident policy issued or renewed

 

during the period July 1, 2008 to June 30, 2009, $440,000.00.

     (i) For a motor vehicle accident policy issued or renewed

 

during the period July 1, 2009 to June 30, 2010, $460,000.00.

 

     (j) For a motor vehicle accident policy issued or renewed

 

during the period July 1, 2010 to June 30, 2011, $480,000.00.

 

     (k) For a motor vehicle accident policy issued or renewed

 

during the period July 1, 2011 to June 30, 2013, $500,000.00.

 

Beginning July 1, 2013, this $500,000.00 amount shall be increased

 

biennially on July 1 of each odd-numbered year, for policies issued

 

or renewed before July 1 of the following odd-numbered year, by the

 

lesser of 6% or the consumer price index, and rounded to the

 

nearest $5,000.00. This biennial adjustment shall be calculated by

 

the association by January 1 of the year of its July 1 effective

 

date.

 

     (l) For a motor vehicle accident policy issued or renewed

 

during the period July 1, 2013 to June 30, 2015, $530,000.00.

 

     (m) For a motor vehicle accident policy issued or renewed

 

during the period July 1, 2015 to June 30, 2017, $545,000.00.

 

     (n) For a motor vehicle accident policy issued or renewed

 

during the period July 1, 2017 to June 30, 2020, $555,000.00.

 

     (3) An insurer may withdraw from the association only upon on

 

ceasing to write insurance that provides the security required by

 

section 3101(1) in this state.

 

     (4) An insurer whose membership in the association has been

 

terminated by withdrawal shall continue continues to be bound by

 

the plan of operation, and upon on withdrawal, all unpaid premiums

 

that have been charged to the withdrawing member are payable as of

 

the effective date of the withdrawal.

     (5) An unsatisfied net liability to the association of an

 

insolvent member shall be assumed by and apportioned among the

 

remaining members of the association as provided in the plan of

 

operation. The association has all rights allowed by law on behalf

 

of the remaining members against the estate or funds of the

 

insolvent member for sums money due the association.

 

     (6) If a member has been merged or consolidated into another

 

insurer or another insurer has reinsured a member's entire business

 

that provides the security required by section 3101(1) in this

 

state, the member and successors in interest of the member remain

 

liable for the member's obligations.

 

     (7) The Before July 1, 2020, the association shall do all of

 

the following on behalf of the members of the association:

 

     (a) Assume 100% of all liability as provided in subsection

 

(2).

 

     (b) Establish procedures by which members shall promptly

 

report to the association each claim that, on the basis of the

 

injuries or damages sustained, may reasonably be anticipated to

 

involve the association if the member is ultimately held legally

 

liable for the injuries or damages. Solely for the purpose of

 

reporting claims, the member shall in all instances consider itself

 

legally liable for the injuries or damages. The member shall also

 

advise the association of subsequent developments likely to

 

materially affect the interest of the association in the claim.

 

     (c) Maintain relevant loss and expense data relative to all

 

liabilities of the association and require each member to furnish

 

statistics, in connection with liabilities of the association, at

the times and in the form and detail as may be required by the plan

 

of operation.

 

     (d) In a manner provided for in the plan of operation,

 

calculate and charge to members of the association a total premium

 

sufficient to cover the expected losses and expenses of the

 

association that the association will likely incur during the

 

period for which the premium is applicable. The premium shall must

 

include an amount to cover incurred but not reported losses for the

 

period and may be adjusted for any excess or deficient premiums

 

from previous periods. Excesses or deficiencies from previous

 

periods may be fully adjusted in a single period or may be adjusted

 

over several periods in a manner provided for in the plan of

 

operation. Each member shall must be charged an amount equal to

 

that member's total written car years of insurance providing the

 

security required by section 3101(1) or 3103(1), or both, written

 

in this state during the period to which the premium applies,

 

multiplied by the average premium per car. The average premium per

 

car shall be is the total premium calculated divided by the total

 

written car years of insurance providing the security required by

 

section 3101(1) or 3103(1), written in this state of all members

 

during the period to which the premium applies. A member shall must

 

be charged a premium for a historic vehicle that is insured with

 

the member of 20% of the premium charged for a car insured with the

 

member. As used in this subdivision:

 

     (i) "Car" includes a motorcycle but does not include a

 

historic vehicle.

 

     (ii) "Historic vehicle" means a vehicle that is a registered

historic vehicle under section 803a or 803p of the Michigan vehicle

 

code, 1949 PA 300, MCL 257.803a and 257.803p.

 

     (e) Require and accept the payment of premiums from members of

 

the association as provided for in the plan of operation. The

 

association shall do either of the following:

 

     (i) Require payment of the premium in full within 45 days

 

after the premium charge.

 

     (ii) Require payment of the premiums to be made periodically

 

to cover the actual cash obligations of the association.

 

     (f) Receive and distribute all sums money required by the

 

operation of the association.

 

     (g) Establish procedures for reviewing claims procedures and

 

practices of members of the association. If the claims procedures

 

or practices of a member are considered inadequate to properly

 

service the liabilities of the association, the association may

 

undertake or may contract with another person, including another

 

member, to adjust or assist in the adjustment of claims for the

 

member on claims that create a potential liability to the

 

association and may charge the cost of the adjustment to the

 

member.

 

     (h) Do anything necessary, as required by the board or the

 

director of the department, to prepare for and complete the

 

assumption of obligations of the association by the department as

 

provided by section 3104a.

 

     (8) In addition to other powers granted to it by this section,

 

the association may do all of the following:

 

     (a) Sue and be sued in the name of the association. A judgment

against the association shall does not create any direct liability

 

against the individual members of the association. The association

 

may provide for the indemnification of its members, members of the

 

board of directors of the association, and officers, employees, and

 

other persons lawfully acting on behalf of the association.

 

     (b) Reinsure all or any portion of its potential liability

 

with reinsurers licensed to transact insurance in this state or

 

approved by the commissioner.director of the department.

 

     (c) Provide for appropriate housing, equipment, and personnel

 

as may be necessary to assure the efficient operation of the

 

association.

 

     (d) Pursuant to the plan of operation, adopt reasonable rules

 

for the administration of the association, enforce those rules, and

 

delegate authority, as the board considers necessary to assure the

 

proper administration and operation of the association consistent

 

with the plan of operation.

 

     (e) Contract for goods and services, including independent

 

claims management, actuarial, investment, and legal services, from

 

others within in or without outside of this state to assure the

 

efficient operation of the association.

 

     (f) Hear and determine complaints of a company or other

 

interested party concerning the operation of the association.

 

     (g) Perform other acts not specifically enumerated in this

 

section that are necessary or proper to accomplish the purposes of

 

the association and that are not inconsistent with this section or

 

the plan of operation.

 

     (9) A board of directors is created , hereinafter referred to

as the board, which shall be responsible for the operation of and

 

shall operate the association consistent with the plan of operation

 

and this section.

 

     (10) The plan of operation shall must provide for all of the

 

following:

 

     (a) The establishment of necessary facilities.

 

     (b) The management and operation of the association.

 

     (c) Procedures to be utilized in charging premiums, including

 

adjustments from excess or deficient premiums from prior periods.

 

     (d) Procedures governing the actual payment of premiums to the

 

association.

 

     (e) Reimbursement of each member of the board by the

 

association for actual and necessary expenses incurred on

 

association business.

 

     (f) The investment policy of the association.

 

     (g) Any other matters required by or necessary to effectively

 

implement this section.

 

     (11) Each board shall include members that would contribute a

 

total of not less than 40% of the total premium calculated pursuant

 

to subsection (7)(d). Each director shall be is entitled to 1 vote.

 

The initial term of office of a director shall be is 2 years.

 

     (12) As part of the plan of operation, the board shall adopt

 

rules providing for the composition and term of successor boards to

 

the initial board, consistent with the membership composition

 

requirements in subsections (11) and (13). Terms of the directors

 

shall must be staggered so that the terms of all the directors do

 

not expire at the same time and so that a director does not serve a

term of more than 4 years.

 

     (13) The board shall must consist of 5 directors , and the

 

commissioner director of the department, who shall be serve as an

 

ex officio member of the board without vote. At least 1 of the

 

members of the board must represent each of the following groups or

 

organizations:

 

     (a) Claimants receiving benefits from the association.

 

     (b) Insurance actuaries.

 

     (c) The state court administrative office.

 

     (d) Insurance fraud experts.

 

     (e) Consumer fraud experts.

 

     (14) Each director shall be appointed by the commissioner and

 

The director of the department shall appoint the directors. A

 

director shall serve until that member's his or her successor is

 

selected and qualified. The chairperson of the board shall be

 

elected by the board. A elect a chairperson. The director of the

 

department shall fill any vacancy on the board shall be filled by

 

the commissioner consistent with as provided in the plan of

 

operation.

 

     (15) After the board is appointed, the The board shall meet as

 

often as the chairperson, the commissioner, director of the

 

department, or the plan of operation shall require, requires, or at

 

the request of any 3 members of the board. The chairperson shall

 

retain the right to may vote on all issues. Four members of the

 

board constitute a quorum.

 

     (16) An annual report of the operations of the association in

 

a form and detail as may be determined by the board shall must be

furnished to each member.

 

     (17) Not more than 60 days after the initial organizational

 

meeting of the board, the board shall submit to the commissioner

 

for approval a proposed plan of operation consistent with the

 

objectives and provisions of this section, which shall provide for

 

the economical, fair, and nondiscriminatory administration of the

 

association and for the prompt and efficient provision of

 

indemnity. If a plan is not submitted within this 60-day period,

 

then the commissioner, after consultation with the board, shall

 

formulate and place into effect a plan consistent with this

 

section.

 

     (18) The plan of operation, unless approved sooner in writing,

 

shall be considered to meet the requirements of this section if it

 

is not disapproved by written order of the commissioner within 30

 

days after the date of its submission. Before disapproval of all or

 

any part of the proposed plan of operation, the commissioner shall

 

notify the board in what respect the plan of operation fails to

 

meet the requirements and objectives of this section. If the board

 

fails to submit a revised plan of operation that meets the

 

requirements and objectives of this section within the 30-day

 

period, the commissioner shall enter an order accordingly and shall

 

immediately formulate and place into effect a plan consistent with

 

the requirements and objectives of this section.

 

     (17) (19) The proposed plan of operation or Any amendments to

 

the plan of operation of the association are subject to majority

 

approval by the board, ratified ratification by a majority of the

 

membership having a vote, with voting rights being apportioned

according to the premiums charged in subsection (7)(d), and are

 

subject to approval by the commissioner.director of the department.

 

     (18) (20) Upon approval by the commissioner and ratification

 

by the members of the plan submitted, or upon the promulgation of a

 

plan by the commissioner, each insurer authorized to write

 

insurance providing the security required by section 3101(1) in

 

this state, as provided in this section, A member of the

 

association is bound by and shall formally subscribe to and

 

participate in the plan approved of operation as a condition of

 

maintaining its authority to transact insurance in this state.

 

     (19) Notwithstanding anything in this section or the plan of

 

operation to the contrary, the board, the association, and the

 

members of the association shall do all of the following:

 

     (a) As required by the director of the department or otherwise

 

under section 3104a, transfer any records or copies of records for

 

the implementation and administration of section 3104a.

 

     (b) Cooperate with the director of the department or any

 

agency in the department in the implementation and administration

 

of section 3104a.

 

     (c) In the time and manner required by the director of the

 

department, transfer any money in the possession or control of the

 

board, association, or member that belongs or is attributable to

 

the association to implement and administer section 3104a.

 

     (20) (21) The association is subject to all the reporting,

 

loss reserve, and investment requirements of the commissioner

 

director of the department to the same extent as would a member are

 

the members of the association.

     (21) (22) Premiums charged members by the association shall

 

must be recognized in the rate-making procedures for insurance

 

rates in the same manner that expenses and premium taxes are

 

recognized.

 

     (22) (23) The commissioner director of the department or an

 

authorized representative of the commissioner director of the

 

department may visit the association at any time and examine any

 

and all of the association's affairs.

 

     (23) (24) The association does not have liability for losses

 

occurring before July 1, 1978 or after June 30, 2020.

 

     (24) (25) As used in this section:

 

     (a) "Consumer price index" means the percentage of change in

 

the consumer price index for all urban consumers in the United

 

States city average for all items for the 24 months prior to

 

October 1 of the year prior to the July 1 effective date of the

 

biennial adjustment under subsection (2)(k) as reported by the

 

United States department of labor, bureau of labor statistics, and

 

as certified by the commissioner.

 

     (a) "Association" means the catastrophic claims association

 

created in subsection (1).

 

     (b) "Board" means the board of directors of the association

 

created in subsection (9).

 

     (c) (b) "Motor vehicle accident policy" means a policy

 

providing the coverages required under section 3101(1).

 

     (d) (c) "Ultimate loss" means the actual loss amounts that a

 

member is obligated to pay and that are paid or payable by the

 

member, and do not include claim expenses. An ultimate loss is

incurred by the association on the date that the loss occurs.

 

     Sec. 3104a. (1) Before July 1, 2020, the director shall

 

organize a catastrophic claims bureau in the department. The bureau

 

must be organized to do all of the following:

 

     (a) After June 30, 2020, pay, to or on behalf of an

 

individual, any amount to which the individual is entitled as

 

personal protection insurance benefits under this chapter because

 

of an ultimate loss that has exceeded the applicable amount under

 

section 3104(2).

 

     (b) Receive, from the association and members or former

 

members of the association, and maintain records relating to claims

 

as to which the ultimate loss has exceeded the applicable amount

 

under section 3104(2) or that, on the basis of the injuries or

 

damages sustained, may reasonably be anticipated to exceed the

 

applicable amount.

 

     (c) Establish procedures for reviewing claim records received

 

under subdivision (b) and claims for payment under subdivision (a)

 

so as to properly pay benefits under this chapter.

 

     (d) Subject to subsection (3), calculate and charge to

 

insurers that issue automobile insurance policies in this state a

 

total premium sufficient to cover the expected payments of amounts

 

under this section by the bureau during the period for which the

 

premium is applicable. The premium must include an amount to cover

 

incurred but not reported losses for the period and may be adjusted

 

for any excess or deficient premiums from previous periods.

 

Excesses or deficiencies from previous periods may be fully

 

adjusted in a single period or may be adjusted over several

periods. The bureau shall charge an automobile insurer an amount

 

equal to the insurer's total written car years of insurance written

 

in this state during the period to which the premium applies,

 

multiplied by the average premium per car. The average premium per

 

car is the total premium under this subdivision divided by the

 

total written car years of insurance written in this state by all

 

insurers during the period to which the premium applies. The bureau

 

shall charge an insurer a premium for a historic vehicle that is

 

insured with the insurer of 20% of the premium charged for a car

 

insured with the member. The bureau shall do either of the

 

following:

 

     (i) Require payment of the premiums in full within 45 days

 

after the premiums are charged.

 

     (ii) Require payment of the premiums to be made periodically

 

to cover the actual cash obligations of the bureau.

 

     (e) Accept the payment of premiums charged under subdivision

 

(d) from insurers.

 

     (f) Establish procedures for reviewing information from former

 

members of the association about claims as to which the injuries or

 

damages sustained may reasonably be anticipated to exceed the

 

applicable amount under section 3104(2). The bureau may contract

 

with another person, including, but not limited to, another

 

insurer, to adjust or assist in the adjustment of such a claim for

 

the former member and may charge the cost of the adjustment to the

 

former member.

 

     (g) Anything else necessary or convenient to implementing or

 

applying this section.

     (2) A former member of the association or an insurer that

 

issues automobile insurance in this state shall do all of the

 

following:

 

     (a) Transfer to the bureau, in the time and manner required by

 

the bureau or the director, all records relating to claims as to

 

which the ultimate loss has exceeded the applicable amount under

 

section 3104(2), including, but not limited to, records requested

 

by the bureau or the director.

 

     (b) Provide to the bureau, in the time and manner required by

 

the bureau or the director, copies of all records relating to

 

claims that, on the basis of the injuries or damages sustained, may

 

reasonably be anticipated to exceed the applicable amount under

 

section 3104(2), including, but not limited to, records requested

 

by the bureau or the director.

 

     (c) Cooperate with the bureau with respect to claims described

 

in subdivision (b), including, but not limited to, providing any

 

requested information to the bureau and cooperating with any person

 

with whom the bureau contracts under subsection (1)(f).

 

     (d) Provide the bureau with all information requested by the

 

bureau and any other information necessary to allow the bureau to

 

calculate premiums under subsection (1)(d).

 

     (e) Pay any premium charged by the bureau under subsection

 

(1)(d) as required by the bureau.

 

     (f) Pay any other money in the former member's or insurer's

 

possession that is attributable to the association.

 

     (g) Do anything else required by the bureau or the director

 

that is necessary or convenient to the implementation or

administration of this section.

 

     (3) The bureau shall not charge premiums under subsection

 

(1)(d) unless money received under subsections (1)(b) and (e) and

 

(2) and held by the bureau, with interest and other earnings from

 

the money held, are insufficient to cover the expected payments of

 

amounts under this section for the applicable period.

 

     (4) Premiums that the bureau charges to insurers under

 

subsection (1)(d) must be recognized in the rate-making procedures

 

for insurance rates in the same manner that expenses and premium

 

taxes are recognized.

 

     (5) The bureau shall annually disclose to the public on the

 

department website money held by the bureau, interest and other

 

earnings of the bureau, and all data used in computing the expected

 

losses and expenses of administering this section and determining

 

any premiums charged under subsection (1)(d), including the amount

 

that covers incurred but not reported losses for the period and any

 

adjustment for any excess or deficient premiums from previous

 

periods and the actuarial computation used in making these

 

determinations, including estimates and assumptions. The disclosure

 

must include, but not be limited to, all of the following:

 

     (a) The actuarial computation used in making determinations of

 

unpaid losses and loss adjustment expenses.

 

     (b) All documents used in establishing the following:

 

     (i) The calculation of the present value of disbursements

 

expected to be made in the ultimate settlement of the claims

 

reported.

 

     (ii) The actuarial tables used to reflect the probabilities of

each claimant surviving to incur the costs projected.

 

     (iii) The calculation of incurred but not reported losses.

 

     (iv) The actuarial assumptions and calculations used in

 

producing the short-term discount rate and the long-term discount

 

rate.

 

     (v) The forecasts producing the economic assumptions for claim

 

cost inflation and investment returns used.

 

     (vi) The current economic data and historical long-term

 

Consumer Price Index data for any cost component categories used in

 

producing inflation assumptions.

 

     (vii) The loss development analysis undertaken in connection

 

with the provision for unpaid losses and loss adjustment expenses.

 

     (viii) The trend analysis for both frequency and severity

 

undertaken in connection with the provision for unpaid losses and

 

loss adjustment expenses.

 

     (c) The annual actuarial evaluation used in establishing any

 

premium.

 

     (d) Annual assessment reports used in establishing any

 

premium.

 

     (e) The annuity model used by the opining actuary in his or

 

her actuarial opinion projecting future payment streams at the

 

claimant level and the mortality adjustment applied.

 

     (f) Any explanatory memorandum explaining the various

 

components of the premium and the judgments made to produce the

 

premium.

 

     (g) The impact of expense reduction initiatives for the prior

 

reporting period, including at a minimum amount estimates for the

following initiatives:

 

     (i) Insurer fraud reduction.

 

     (ii) Consumer fraud reduction.

 

     (iii) Healthcare cost reduction.

 

     (iv) Court cost reduction.

 

     (h) The breakdown of payments into legacy and safety net

 

coverage.

 

     (6) The director shall annually appoint an independent

 

certified public accountant to conduct and deliver to the director

 

and the senate and house of representatives standing committees on

 

insurance issues an audit of money held by and income of the bureau

 

and expenses of administering this section. In conducting the

 

audit, the appointed certified public accountant must be given

 

access to all records of the bureau. Each audit required by this

 

subsection must include a determination of whether the bureau is

 

likely to be able to continue to meet its obligations.

 

     (7) As required by the director, the bureau shall administer

 

this section and do anything related to the administration of this

 

section.

 

     (8) The director shall do all of the following:

 

     (a) All things necessary to ensure that the bureau is properly

 

administering this section.

 

     (b) All things necessary to ensure that insurers, including

 

former members of the association and insurers that issue

 

automobile insurance policies in this state, are complying with

 

this section.

 

     (c) As necessary, promulgate rules to implement this section

under the administrative procedures act of 1969, 1969 PA 306, MCL

 

24.201 to 24.328.

 

     (9) As used in this section:

 

     (a) "Association" means the catastrophic claims association

 

created under section 3104.

 

     (b) "Bureau" means the catastrophic claims bureau created

 

under this section.

 

     (c) "Car" includes a motorcycle but does not include a

 

historic vehicle.

 

     (d) "Historic vehicle" means a vehicle that is a registered

 

historic vehicle under section 803a or 803p of the Michigan vehicle

 

code, 1949 PA 300, MCL 257.803a and 257.803p.

 

     (e) "Ultimate loss" means that term as defined in section

 

3104.

 

     Sec. 3104b. (1) The Michigan accident liability safety net

 

fund is created within the state treasury.

 

     (2) The bureau shall pay into the fund money received by the

 

bureau under section 3104a(1)(b) and (e) and (2). The state

 

treasurer may receive money or other assets from the bureau or any

 

other source for deposit into the fund.

 

     (3) The bureau shall direct the investment of the fund. The

 

bureau shall invest money held in the fund in low- to marginally

 

low-risk investments that maximize returns while safeguarding

 

against significant losses. The bureau shall credit to the fund

 

interest and earnings from fund investments.

 

     (4) Money in the fund at the close of the fiscal year must

 

remain in the fund and not lapse to the general fund.

     (5) The department of insurance and financial services is the

 

administrator of the fund for auditing purposes.

 

     (6) The bureau shall expend money from the fund, on

 

appropriation, only for 1 or more of the following purposes:

 

     (a) The payment of claims under section 3104a(1)(a).

 

     (b) Operation of the bureau.

 

     (7) As used in this section:

 

     (a) "Bureau" means the catastrophic claims bureau organized

 

under section 3104a.

 

     (b) "Fund" means the Michigan accident liability safety net

 

fund created under subsection (1).

 

     Sec. 3104c. (1) All of the following apply to allowable

 

expenses payable by the catastrophic claims bureau under section

 

3104a for attendant care provided in the home by a family or

 

household member:

 

     (a) For the first 56 hours of attendant care provided in a

 

week, payment is limited to a reasonable and customary amount.

 

     (b) For attendant care in excess of 56 hours provided in a

 

week, payment is limited to $15.00 per hour. Beginning 3 years

 

after the effective date of the amendatory act that added this

 

section and every 3 years after that date, the director shall

 

adjust this amount to reflect the aggregate percentage change in

 

the United States Consumer Price Index, rounded to the nearest 10

 

cents. As used in this subdivision, "Consumer Price Index" means

 

the percentage of change in the Consumer Price Index for all urban

 

consumers in the United States city average for all items, as

 

reported by the United States Department of Labor, Bureau of Labor

Statistics, and as certified by the director.

 

     (c) The limitations in subdivisions (a) and (b) apply

 

regardless of the level of care provided and regardless of whether

 

the family or household member is licensed or otherwise authorized

 

to render the attendant care under article 15 of the public health

 

code, 1978 PA 368, MCL 333.16101 to 333.18838, or is employed by,

 

under contract with, or in any way connected with an individual or

 

agency who is licensed or authorized to render the care.

 

     (2) Except as otherwise provided in subsection (3), for

 

allowable expenses under section 3107(1)(a) for attendant care

 

provided in the home, whether by a family or household member or by

 

someone other than a family or household member, payment is limited

 

to a total of 24 hours per day for services performed by 1 or more

 

individuals.

 

     (3) Notwithstanding the limitations in this section, the

 

bureau may contract to provide attendant care as an allowable

 

expense at any rate and for any number of hours per week.

 

     Sec. 3131. (1) Residual liability insurance shall must cover

 

bodily injury and property damage which that occurs within in the

 

United States, its territories and possessions, or in Canada. This

 

insurance shall must afford coverage equivalent to that required as

 

evidence of automobile liability insurance under the financial

 

responsibility laws of the place in which the injury or damage

 

occurs. In this state, this insurance shall must afford coverage

 

for automobile liability retained by section 3135.

 

     (2) This section shall does not require coverage in this state

 

other than that required by section 3009(1). This section shall

apply applies to all insurance contracts in force as of October 1,

 

1973, or entered into after that date.October 1, 1973 and before

 

July 1, 2020.

 

     Sec. 3135. (1) A person whose tort liability is abolished

 

under subsection (3) remains subject to tort liability for

 

noneconomic loss caused by his or her ownership, maintenance, or

 

use of a motor vehicle only if the injured person has suffered

 

death, serious impairment of body function, or permanent serious

 

disfigurement.

 

     (2) For a cause of action for damages pursuant to as to which

 

tort liability remains under subsection (1) filed on or after July

 

26, 1996, all of the following apply:

 

     (a) The issues of whether the injured person has suffered

 

serious impairment of body function or permanent serious

 

disfigurement are questions of law for the court if the court finds

 

either of the following:

 

     (i) There is no factual dispute concerning the nature and

 

extent of the person's injuries.

 

     (ii) There is a factual dispute concerning the nature and

 

extent of the person's injuries, but the dispute is not material to

 

the determination whether the person has suffered a serious

 

impairment of body function or permanent serious disfigurement.

 

However, for a closed-head injury, a question of fact for the jury

 

is created if a licensed allopathic or osteopathic physician who

 

regularly diagnoses or treats closed-head injuries testifies under

 

oath that there may be a serious neurological injury.

 

     (b) Damages shall must be assessed on the basis of comparative

fault, except that damages shall must not be assessed in favor of a

 

party who is more than 50% at fault.

 

     (c) Damages shall must not be assessed in favor of a party who

 

was operating his or her own vehicle at the time the injury

 

occurred and did not have in effect for that motor vehicle the

 

security required by section 3101 at the time the injury occurred.

 

     (3) Notwithstanding any other provision of law, tort liability

 

arising from the ownership, maintenance, or use within this state

 

of a motor vehicle with respect to which the security required by

 

section 3101 was in effect is abolished. except as to:This

 

subsection does not apply to:

 

     (a) Intentionally caused harm to persons or property. Even

 

though a person knows that harm to persons or property is

 

substantially certain to be caused by his or her act or omission,

 

the person does not cause or suffer that harm intentionally if he

 

or she acts or refrains from acting for the purpose of averting

 

injury to any person, including himself or herself, or for the

 

purpose of averting damage to tangible property.

 

     (b) Damages for noneconomic loss as provided and limited in

 

subsections (1) and (2).

 

     (c) Damages for allowable expenses, work loss, and survivor's

 

loss as defined in sections 3107 to 3110 in excess of the daily,

 

monthly, and 3-year limitations contained in those sections. The

 

party liable for damages is entitled to an exemption reducing his

 

or her liability by the amount of taxes that would have been

 

payable on account of income the injured person would have received

 

if he or she had not been injured.

     (d) Damages for economic loss by a nonresident in excess of

 

the personal protection insurance benefits provided under section

 

3163(4). Damages under this subdivision are not recoverable to the

 

extent that benefits covering the same loss are available from

 

other sources, regardless of the nature or number of benefit

 

sources available and regardless of the nature or form of the

 

benefits.

 

     (e) Damages up to $1,000.00 to a motor vehicle, to the extent

 

that the damages are not covered by insurance. An action for

 

damages under this subdivision shall must be conducted as provided

 

in subsection (4).

 

     (4) All of the following apply to an action for damages under

 

subsection (3)(e):

 

     (a) Damages shall must be assessed on the basis of comparative

 

fault, except that damages shall must not be assessed in favor of a

 

party who is more than 50% at fault.

 

     (b) Liability is not a component of residual liability, as

 

prescribed in section 3131, for which maintenance of security is

 

required by this act.

 

     (c) The action shall must be commenced, whenever legally

 

possible, in the small claims division of the district court or the

 

municipal court. If the defendant or plaintiff removes the action

 

to a higher court and does not prevail, the judge may assess costs.

 

     (d) A decision of the court is not res judicata in any

 

proceeding to determine any other liability arising from the same

 

circumstances that gave rise to the action.

 

     (e) Damages shall must not be assessed if the damaged motor

vehicle was being operated at the time of the damage without the

 

security required by section 3101.

 

     (5) As used in this section, "serious impairment of body

 

function" means an objectively manifested impairment of an

 

important body function that affects the person's general ability

 

to lead his or her normal life.

 

     Sec. 3163. (1) An Before July 1, 2020, an insurer authorized

 

to transact automobile liability insurance and personal and

 

property protection insurance in this state shall file and maintain

 

a written certification that any accidental bodily injury or

 

property damage occurring in this state arising from the ownership,

 

operation, maintenance, or use of a motor vehicle as a motor

 

vehicle by an out-of-state resident who is insured under its

 

automobile liability insurance policies, is subject to the personal

 

and property protection insurance system under this act.chapter.

 

     (2) A nonadmitted insurer may voluntarily file the

 

certification described in subsection (1).

 

     (3) Except as otherwise provided in subsection (4), if a

 

certification filed under subsection (1) or (2) applies to

 

accidental bodily injury or property damage, the insurer and its

 

insureds with respect to that injury or damage have the rights and

 

immunities under this act for personal and property protection

 

insureds, and claimants have the rights and benefits of personal

 

and property protection insurance claimants, including the right to

 

receive benefits from the electing insurer as if it were an insurer

 

of personal and property protection insurance applicable to the

 

accidental bodily injury or property damage.

     (4) If an insurer of an out-of-state resident is required to

 

provide benefits under subsections (1) to (3) to that out-of-state

 

resident for accidental bodily injury for an accident in which the

 

out-of-state resident was not an occupant of a motor vehicle

 

registered in this state, the insurer is only liable for the amount

 

of ultimate loss sustained up to $500,000.00. Benefits under this

 

subsection are not recoverable to the extent that benefits covering

 

the same loss are available from other sources, regardless of the

 

nature or number of benefit sources available and regardless of the

 

nature or form of the benefits.

 

     Sec. 3171. (1) Until an assigned claims plan is approved under

 

subsection (3), the secretary of state shall organize and maintain

 

an assigned claims facility and plan. A self-insurer and insurer

 

writing insurance as provided by this chapter in this state shall

 

participate in the assigned claims plan. Costs incurred in the

 

operation of the facility and the plan shall be allocated fairly

 

among insurers and self-insurers. The secretary of state shall

 

promulgate rules to implement the facility and plan in accordance

 

with and subject to the administrative procedures act of 1969, 1969

 

PA 306, MCL 24.201 to 24.328. After an assigned claims plan is

 

approved under subsection (3), the secretary of state shall

 

continue to maintain the assigned claims facility and plan

 

organized under this subsection as required by the plan approved

 

under subsection (3).

 

     (2) The Michigan automobile insurance placement facility shall

 

adopt and maintain an assigned claims plan. A self-insurer or

 

insurer writing insurance as provided by this chapter in this

state, that was writing insurance provided by this chapter on June

 

30, 2020, or that writes automobile insurance in this state after

 

June 30, 2020, shall participate in the assigned claims plan. Costs

 

incurred in the administration of the assigned claims plan shall

 

must be allocated fairly among insurers and self-insurers. On

 

approval under subsection (3), the Michigan automobile insurance

 

placement facility shall implement the assigned claims plan.

 

     (2) (3) By August 1, 2012, the The Michigan automobile

 

insurance placement facility board of governors shall adopt an

 

assigned claims plan by majority vote and shall submit it to the

 

commissioner director for his or her approval. The commissioner

 

director shall review the plan within 30 days and respond in

 

writing as provided in this subsection. If the commissioner

 

director finds that the plan meets the requirements of this

 

chapter, he or she shall approve it. If the commissioner director

 

finds that the plan fails to meet the requirements of this chapter,

 

he or she shall state in what respects the plan is deficient and

 

shall afford the Michigan automobile insurance placement facility

 

board of governors 10 days within which to correct the deficiency.

 

If the commissioner director and the Michigan automobile insurance

 

placement facility board of governors fail to agree that the plan

 

submitted, with any corrections, meets the requirements of this

 

chapter, either party to the controversy may submit the issue to

 

the circuit court for Ingham county County for a determination. If

 

the commissioner director fails to render a written decision on the

 

assigned claims plan within 30 days after receipt of the plan, the

 

plan shall be is considered approved. The Michigan automobile

insurance placement facility shall forward a plan approved under

 

this subsection to the secretary of state. The plan takes effect on

 

approval by the commissioner.director.

 

     (3) (4) Amendments to the assigned claims plan approved under

 

subsection (3) shall (2) must be adopted by the board of governors

 

and approved by the commissioner director as provided in subsection

 

(3). Until the date established in the plan under subsection

 

(5)(c), the board of governors shall give the secretary of state

 

advance notice of any proposed amendments to the plan.(2).

 

     (5) The plan adopted under subsection (3) shall include all of

 

the following:

 

     (a) The date on and after which all claims for benefits

 

through the assigned claims plan under section 3172 shall be filed

 

with the Michigan automobile insurance placement facility.

 

     (b) The date by which existing claims that have been assigned

 

under the plan maintained by the secretary of state under

 

subsection (1) will be transferred to the Michigan automobile

 

insurance placement facility to be included in and administered

 

under the adopted plan.

 

     (c) A date by which all functions of the assigned claims plan

 

maintained by the secretary of state, with the exception of driver

 

license and vehicle sanctions, will be transferred to the Michigan

 

automobile insurance placement facility.

 

     (d) Requirements for the transfer of records relating to

 

assigned claims from the secretary of state to the Michigan

 

automobile insurance placement facility and the disposition by the

 

secretary of state of records relating to assigned claims.

     (e) Reimbursement of the secretary of state by the Michigan

 

automobile insurance placement facility for all of the following:

 

     (i) Expenses of developing the plan under subsection (6).

 

     (ii)Expenses of transferring operations from the assigned

 

claims facility to the Michigan automobile insurance placement

 

facility.

 

     (iii) Expenses incurred by the secretary of state after the

 

transfer of operations from the assigned claims facility to the

 

Michigan automobile insurance placement facility for operations

 

performed by the secretary of state on behalf of the Michigan

 

automobile insurance placement facility.

 

     (6) The secretary of state and the Michigan automobile

 

insurance placement facility shall cooperate and mutually develop

 

the aspects of the plan to be adopted under subsection (3) that are

 

required under subsection (5).

 

     (7) The secretary of state shall provide the Michigan

 

automobile insurance placement facility with all information

 

necessary for the operation of the assigned claims fund.

 

     (8) One year after the date established under subsection

 

(5)(c), the commissioner shall report in writing to the senate and

 

house of representatives standing committees on insurance issues on

 

the cost of the transfer of the assigned claims plan to the

 

Michigan automobile insurance placement facility and the

 

effectiveness of operations under the new plan.

 

     (4) (9) As used in this section:

 

     (a) "Michigan automobile insurance placement facility" means

 

the Michigan automobile insurance placement facility created under

chapter 33.

 

     (b) "Michigan automobile insurance placement facility board of

 

governors" means the board of governors created under section 3310.

 

     Sec. 3172. (1) A person entitled to claim because of

 

accidental bodily injury arising out of the ownership, operation,

 

maintenance, or use of a motor vehicle as a motor vehicle in this

 

state may obtain personal protection insurance benefits through the

 

assigned claims plan under 1 or more of the following

 

circumstances:

 

     (a) For accidental bodily injury that occurs before July 1,

 

2020, if no personal protection insurance is applicable to the

 

injury.

 

     (b) For accidental bodily injury that occurs before July 1,

 

2020, if no personal protection insurance applicable to the injury

 

can be identified.

 

     (c) For accidental bodily injury regardless of when it occurs,

 

if the personal protection insurance applicable to the injury

 

cannot be ascertained because of a dispute between 2 or more

 

automobile insurers concerning their obligation to provide coverage

 

or the equitable distribution of the loss. , or

 

     (d) For accidental bodily injury regardless of when it occurs,

 

if the only identifiable personal protection insurance applicable

 

to the injury is, because of financial inability of 1 or more

 

insurers to fulfill their obligations, inadequate to provide

 

benefits up to the maximum prescribed. In that case, If this

 

subdivision applies, unpaid benefits due or coming due may be

 

collected under the assigned claims plan and the insurer to which

the claim is assigned is entitled to reimbursement from the

 

defaulting insurers to the extent of their financial

 

responsibility.

 

     (2) Except as otherwise provided in this subsection, personal

 

protection insurance benefits, including benefits arising from

 

accidents occurring before March 29, 1985, payable through the

 

assigned claims plan shall must be reduced to the extent that

 

benefits covering the same loss are available from other sources,

 

regardless of the nature or number of benefit sources available and

 

regardless of the nature or form of the benefits, to a person

 

claiming personal protection insurance benefits through the

 

assigned claims plan. This subsection only applies if the personal

 

protection insurance benefits are payable through the assigned

 

claims plan because no personal protection insurance is applicable

 

to the injury, no personal protection insurance applicable to the

 

injury can be identified, or the only identifiable personal

 

protection insurance applicable to the injury is, because of

 

financial inability of 1 or more insurers to fulfill their

 

obligations, inadequate to provide benefits up to the maximum

 

prescribed. As used in this subsection, "sources" and "benefit

 

sources" do not include the program for medical assistance for the

 

medically indigent under the social welfare act, 1939 PA 280, MCL

 

400.1 to 400.119b, or insurance under the health insurance for the

 

aged act, title subchapter XVIII of the social security act, 42 USC

 

1395 to 1395kkk-1.1395lll.

 

     (3) If the obligation to provide personal protection insurance

 

benefits cannot be ascertained because of a dispute between 2 or

more automobile insurers concerning their obligation to provide

 

coverage or the equitable distribution of the loss, and if a method

 

of voluntary payment of benefits cannot be agreed upon among or

 

between the disputing insurers, all of the following apply:

 

     (a) The insurers who are parties to the dispute shall, or the

 

claimant may, immediately notify the Michigan automobile insurance

 

placement facility of their inability to determine their statutory

 

obligations.

 

     (b) The claim shall must be assigned by the Michigan

 

automobile insurance placement facility to an insurer and the

 

insurer shall immediately provide personal protection insurance

 

benefits to the claimant or claimants entitled to benefits.

 

     (c) An action shall must be immediately commenced on behalf of

 

the Michigan automobile insurance placement facility by the insurer

 

to whom the claim is assigned in circuit court to declare the

 

rights and duties of any interested party.

 

     (d) The insurer to whom the claim is assigned shall join as

 

parties defendant to the action commenced under subdivision (c)

 

each insurer disputing either the obligation to provide personal

 

protection insurance benefits or the equitable distribution of the

 

loss among the insurers.

 

     (e) The circuit court shall declare the rights and duties of

 

any interested party whether or not other relief is sought or could

 

be granted.

 

     (f) After hearing the action, the circuit court shall

 

determine the insurer or insurers, if any, obligated to provide the

 

applicable personal protection insurance benefits and the equitable

distribution, if any, among the insurers obligated, and shall order

 

reimbursement to the Michigan automobile insurance placement

 

facility from the insurer or insurers to the extent of the

 

responsibility as determined by the court. The reimbursement

 

ordered under this subdivision shall must include all benefits and

 

costs paid or incurred by the Michigan automobile insurance

 

placement facility and all benefits and costs paid or incurred by

 

insurers determined not to be obligated to provide applicable

 

personal protection insurance benefits, including reasonable,

 

actually incurred attorney fees and interest at the rate prescribed

 

in section 3175 as of December 31 of the year preceding the

 

determination of the circuit court.

 

     (4) If a person sustains accidental bodily injury after June

 

30, 2020 and obtains a civil judgment for damages for the bodily

 

injury, and if an abstract is certified because the judgment has

 

not been satisfied as provided in section 511 of the Michigan

 

vehicle code, 1949 PA 300, MCL 257.511, the person is entitled to

 

benefits through the assigned claims plan. The person may claim

 

personal protection insurance benefits that would have been payable

 

under this chapter for accidental bodily injury before July 1,

 

2020.

 

     Sec. 3179. (1) This act Subject to subsection (2), this

 

chapter applies to motor vehicle accidents occurring on or after

 

October 1, 1973.

 

     (2) Unless expressly provided otherwise in this chapter, this

 

chapter does not apply to a motor vehicle accident that occurs

 

after June 30, 2020.

     Sec. 3303. As used in this chapter:

 

     (a) "Automobile insurance" means insurance for automobiles

 

which provides any of the following:

 

     (i) Security required pursuant to under section 3101.

 

     (ii) Personal protection, property protection, and residual

 

liability insurance for amounts in excess of the amounts required

 

under chapter 31.

 

     (iii) Automobile liability or motor vehicle liability

 

insurance.

 

     (iv) (iii) Insurance coverage customarily known as

 

comprehensive and collision.

 

     (v) (iv) Other insurance coverages for a private passenger

 

nonfleet automobile as prescribed by rule promulgated by the

 

commissioner.director.

 

     (b) "Qualified applicant", for automobile insurance, means a

 

person who is an owner or registrant of an automobile registered or

 

to be registered in this state or who holds a valid license to

 

operate a motor vehicle, but does not include any of the following:

 

     (i) A person who is not required to maintain security pursuant

 

to under section 3101 or maintain insurance described in section

 

3009, unless the person intends to reside in this state for 30 days

 

or more and makes a written statement of that intention on a form

 

approved by the commissioner.director.

 

     (ii) A person whose license to operate a vehicle is under

 

suspension or revocation, unless the suspension was made pursuant

 

to under section 310, 310b, 310d, 315, 321a, 324, 328, 512, 515,

 

625, 625b, 625f, 748, 801c, or 907 of Act No. 300 of the Public

Acts of 1949, as amended, being sections the Michigan vehicle code,

 

1949 PA 300, MCL 257.310, 257.310b, 257.310d, 257.315, 257.321a,

 

257.324, 257.328, 257.512, 257.515, 257.625, 257.625b, 257.625f,

 

257.748, 257.801c, and 257.907. of the Michigan Compiled Laws.

 

     (iii) A person whose policy of automobile insurance has been

 

cancelled because of nonpayment of premium or finance premium

 

within the immediately preceding 2-year period, unless the

 

applicant or insured pays in full a premium installment developed

 

under section 3350(a) before issuance, continuation, or renewal of

 

the policy.

 

     (c) "Facility" means the automobile insurance placement

 

facility created pursuant to under this chapter.

 

     (d) "Participating member" means an insurer who is required by

 

this chapter to be a member of the facility and who in any given a

 

calendar year has a participation ratio greater than zero in the

 

facility for that year.

 

     (e) "Participation ratio" means the ratio of the participating

 

member's Michigan premiums or exposure units to the comparable

 

statewide totals for all participating members, as follows:

 

     (i) For private passenger nonfleet automobile insurance, for

 

distribution of risk or distribution of loss, the ratio shall must

 

be based on voluntary net direct automobile insurance car years

 

written in this state for the calendar year ending December 31 of

 

the second prior year as reported to the statistical agent of each

 

participating member as private passenger nonfleet exposure.

 

     (ii) For all other automobile insurance, including insurance

 

for fleets, commercial vehicles, public vehicles, and garages, the

ratio for distribution of risks or distribution of loss shall must

 

be based on the total Michigan automobile insurance gross direct

 

premiums written, including policy and membership fees, less return

 

premiums and premiums on policies not taken, without including

 

reinsurance assumed and without deducting reinsurance ceded,

 

reduced by the amount of premiums reported as private passenger

 

nonfleet for the calendar year ending December 31 of the second

 

prior year.

 

     (iii) For expenses of operation of the facility and for voting

 

rights, the ratio shall must be based on the total Michigan

 

automobile insurance gross direct premiums written, including

 

policy and membership fees, less return premiums and premiums on

 

policies not taken, without including reinsurance assumed and

 

without deducting reinsurance ceded for the calendar year ending

 

December 31 of the second prior year.

 

     (f) "Private passenger nonfleet automobile" means a motorized

 

vehicle designed for transporting passengers or goods, subject to

 

specific contemporary definitions for insurance purposes as

 

provided in the plan of operation.

 

     Sec. 4501. As used in this chapter:

 

     (a) "Authorized agency" means the department of state police;

 

a city, village, or township police department; a county sheriff's

 

department; a United States criminal investigative department or

 

agency; the prosecuting authority of a city, village, township,

 

county, or state or of the United States; the office of financial

 

and insurance regulation; department; the Michigan automobile

 

insurance fraud authority; or the department of state.

     (b) "Financial loss" includes, but is not limited to, loss of

 

earnings, out-of-pocket and other expenses, repair and replacement

 

costs, investigative costs, and claims payments.

 

     (c) "Insurance policy" or "policy" means an insurance policy,

 

benefit contract of a self-funded plan, health maintenance

 

organization contract, nonprofit dental care corporation

 

certificate, or health care corporation certificate.

 

     (d) "Insurer" means a property-casualty insurer, life insurer,

 

third party administrator, self-funded plan, health insurer, health

 

maintenance organization, nonprofit dental care corporation, health

 

care corporation, reinsurer, or any other entity regulated by the

 

insurance laws of this state and providing any form of insurance.

 

     (e) "Michigan automobile insurance fraud authority" means the

 

Michigan automobile insurance fraud authority created under section

 

6302.

 

     (f) (e) "Organization" means an organization or internal

 

department of an insurer established to detect and prevent

 

insurance fraud.

 

     (g) (f) "Person" includes an individual, insurer, company,

 

association, organization, Lloyds, society, reciprocal or inter-

 

insurance exchange, partnership, syndicate, business trust,

 

corporation, and any other legal entity.

 

     (h) (g) "Practitioner" means a licensee of this state

 

authorized to practice medicine and surgery, psychology,

 

chiropractic, or law, any other licensee of the this state, or an

 

unlicensed health care provider whose services are compensated,

 

directly or indirectly, by insurance proceeds, or a licensee

similarly licensed in other states and nations, or the practitioner

 

of any nonmedical treatment rendered in accordance with a

 

recognized religious method of healing.

 

     (i) (h) "Runner", "capper", or "steerer" means a person who

 

receives a pecuniary or other benefit from a practitioner, whether

 

directly or indirectly, for procuring or attempting to procure a

 

client, patient, or customer at the direction or request of, or in

 

cooperation with, a practitioner whose intent is to obtain benefits

 

under a contract of insurance or to assert a claim against an

 

insured or an insurer for providing services to the client,

 

patient, or customer. Runner, capper, or steerer does not include a

 

practitioner who procures clients, patients, or customers through

 

the use of public media.

 

     (j) (i) "Statement" includes, but is not limited to, any

 

notice statement, proof of loss, bill of lading, receipt for

 

payment, invoice, account, estimate of property damages, bill for

 

services, claim form, diagnosis, prescription, hospital or doctor

 

record, X-rays, test result, or other evidence of loss, injury, or

 

expense.

 

     Sec. 6107. (1) Before April 1 of each year, each an insurer

 

engaged in writing insurance coverages that provide the security

 

required by section 3101(1) or automobile insurance policies in

 

this state, as a condition of its authority to transact insurance

 

in this state, shall pay to the authority an assessment equal to

 

$1.00 multiplied by the insurer's total written car years of

 

insurance providing that provide the security required by section

 

3101(1) or under automobile insurance policies written in this

state during the preceding year.

 

     (2) The authority shall segregate and deposit money received

 

under subsection (1), and all other money received by the

 

authority, in a fund to be known as the automobile theft prevention

 

fund. The authority shall administer the automobile theft

 

prevention fund.

 

     (3) The authority shall expend money in the automobile theft

 

prevention fund in the following order of priority:

 

     (a) To pay the costs of administration of the authority.

 

     (b) To achieve the purposes and objectives of this chapter,

 

which may include, but not be limited to, the following:

 

     (i) Providing financial support to the department of state

 

police and local law enforcement agencies for economic automobile

 

theft enforcement teams.

 

     (ii) Providing financial support to state or local law

 

enforcement agencies for programs designed to reduce the incidence

 

of economic automobile theft.

 

     (iii) Providing financial support to local prosecutors for

 

programs designed to reduce the incidence of economic automobile

 

theft.

 

     (iv) Providing financial support to judicial agencies for

 

programs designed to reduce the incidence of economic automobile

 

theft.

 

     (v) Providing financial support for neighborhood or community

 

organizations or business organizations for programs designed to

 

reduce the incidence of automobile theft.

 

     (vi) Conducting educational programs designed to inform

automobile owners of methods of preventing automobile theft and to

 

provide equipment, for experimental purposes, to enable automobile

 

owners to prevent automobile theft.

 

     (4) Money in the automobile theft prevention fund must only be

 

used for automobile theft prevention efforts and must be

 

distributed based on need and efficacy as determined by the

 

authority.

 

     (5) Money in the automobile theft prevention fund is not state

 

money.

 

     (6) As used in this section, "written car year" means the

 

portion of a year during which a vehicle is insured as determined

 

by the catastrophic claims association and used to calculate

 

premium charges under section 3104.

 

CHAPTER 63

 

MICHIGAN AUTOMOBILE INSURANCE FRAUD AUTHORITY

 

     Sec. 6301. As used in this chapter:

 

     (a) "Authority" means the Michigan automobile insurance fraud

 

authority created in section 6302.

 

     (b) "Automobile insurance fraud" means a fraudulent insurance

 

act as described in section 4503 that is committed in connection

 

with automobile insurance, including an application for automobile

 

insurance.

 

     (c) "Car years" means net direct private passenger and

 

commercial nonfleet vehicle years of insurance providing the

 

security required by section 3101(1) written in this state for the

 

second previous calendar year as reported to the statistical agent

 

of each insurer.

     Sec. 6302. (1) The Michigan automobile insurance fraud

 

authority is created within the department of the attorney general.

 

The department of the attorney general shall provide staff for the

 

authority.

 

     (2) With the discretion to approve or disapprove programs to

 

be supported, the authority shall do both of the following:

 

     (a) Provide financial support to state or local law

 

enforcement agencies for programs designed to reduce the incidence

 

of automobile insurance fraud.

 

     (b) Provide financial support to state or local prosecutorial

 

agencies for programs designed to reduce the incidence of

 

automobile insurance fraud.

 

     (3) The authority may provide financial support to law

 

enforcement, prosecutorial, insurance, education, or training

 

associations for programs designed to reduce the incidence of

 

automobile insurance fraud.

 

     Sec. 6305. The authority has the powers necessary to carry out

 

its duties under this act, including, but not limited to, the power

 

to do the following:

 

     (a) Sue and be sued.

 

     (b) Solicit and accept gifts, grants, loans, and other aid

 

from any person, the federal government, this state, a local unit

 

of government, or an agency of the federal government, this state,

 

or a local unit of government.

 

     (c) Make grants and investments.

 

     (d) Procure insurance against any loss in connection with its

 

property, assets, or activities.

     (e) Invest at its discretion any money held in reserve or

 

sinking funds or any money not required for immediate use or

 

disbursement and to select and use depositories for its money.

 

     (f) Contract for goods and services and engage personnel as

 

necessary.

 

     (g) Perform other acts not specifically enumerated in this

 

section that are necessary or proper to accomplish the purposes of

 

the authority and that are not inconsistent with this section or

 

the plan of operation.

 

     Sec. 6307. An insurer or self-insurer engaged in writing

 

insurance coverages that provide the security required by section

 

3101(1) in this state may pay to the authority, money to be used by

 

the authority to carry out its duties under this chapter.

 

     Sec. 6308. (1) An insurer authorized to transact automobile

 

insurance in this state, as a condition of its authority to

 

transact insurance in this state, shall report automobile insurance

 

fraud data to the authority using the format and procedures adopted

 

by the authority. Data required to be reported under this section

 

includes, at a minimum, all of the following information:

 

     (a) The number of denied claims and the amount of each claim

 

denied.

 

     (b) The time between submission of claims and the receipt of

 

benefits.

 

     (c) The difference between applicable rates as recommended by

 

an independent third-party organization, as described in section

 

623b of the Michigan vehicle code, 1949 PA 300, MCL 257.623b, and

 

the benefits provided.

     (d) Premium rating errors.

 

     (2) The department of state police shall cooperate with the

 

authority and shall provide available motor vehicle fraud and theft

 

statistics to the authority on request.

 

     (3) The authority shall develop performance metrics that are

 

consistent, controllable, measurable, and attainable. The authority

 

shall use the metrics each year to evaluate new applications

 

submitted for funding consideration and to renew funding for

 

existing programs.

 

     Sec. 6309. A claimant for benefits to be paid from the

 

catastrophic claims association created under section 3104 or the

 

catastrophic claims bureau created under section 3104a, as a

 

condition of receiving the benefits, shall report claimant data as

 

required by the authority, including, but not limited to, the

 

claimant's health status before the accident and health status

 

after the accident.

 

     Sec. 6310. (1) The authority may impose a civil fine on an

 

individual who engages in fraud in connection with the receipt of

 

benefits under an automobile insurance policy. A fine under this

 

subsection must be proportional to the benefits received.

 

     (2) The authority may impose a civil fine on an insurer that

 

engages in fraud in connection with a claim for benefits under an

 

automobile insurance policy. A fine under this subsection must be

 

proportional to the benefits claimed but not paid.

 

     (3) A fine imposed under this section may be enforced in a

 

civil action brought by the attorney general. Fines imposed under

 

this section must be deposited in the Michigan accident liability

safety net fund created under section 3104b.

 

     Sec. 6311. (1) Beginning January 1 of the year after the

 

effective date of the amendatory act that added this section, the

 

authority shall prepare and publish an annual financial report, and

 

beginning July 1 of the year after the effective date of the

 

amendatory act that added this section, the authority shall prepare

 

and publish an annual report to the legislature on the authority's

 

efforts to prevent automobile insurance fraud and cost savings that

 

have resulted from those efforts.

 

     (2) The annual report to the legislature required under

 

subsection (1) must detail the automobile insurance fraud occurring

 

in this state for the previous year, assess the impact of the fraud

 

on rates charged for automobile insurance, summarize prevention

 

programs, and outline allocations made by the authority. Insurers

 

and the director shall cooperate in developing the report as

 

requested by the authority and shall make available to the

 

authority records and statistics concerning automobile insurance

 

fraud, including the number of instances of suspected and confirmed

 

insurance fraud, number of prosecutions and convictions involving

 

automobile insurance fraud, and automobile insurance fraud

 

recidivism. The authority shall evaluate the impact automobile

 

insurance fraud has on the citizens of this state and the costs

 

incurred by the citizens through insurance, police enforcement,

 

prosecution, and incarceration because of automobile insurance

 

fraud. The authority shall submit the report to the legislature

 

required by this section to the senate and house of representatives

 

standing committees with primary jurisdiction over insurance issues

and the director.

 

     Enacting section 1. This amendatory act does not take effect

 

unless all of the following bills of the 99th Legislature are

 

enacted into law:

 

     (a) Senate Bill No. 1217                                     

 

             

 

     (b) Senate Bill No. 1212                                     

 

             

 

     (c) Senate Bill No. 1213                                     

 

             

 

     (d) Senate Bill No. 1214                                     

 

             

 

     (e) Senate Bill No. 1215                                     

 

             

 

     (f) Senate Bill No. 1216