HOUSE BILL No. 5013

 

 

September 26, 2017, Introduced by Rep. Theis 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 2111, 3101, 3104, 3107, 3109a,

 

3113, 3114, 3135, 3142, 3148, 3157, 3163, 3301, 3330, 4501, and

 

4503 (MCL 500.2111, 500.3101, 500.3104, 500.3107, 500.3109a,

 

500.3113, 500.3114, 500.3135, 500.3142, 500.3148, 500.3157,

 

500.3163, 500.3301, 500.3330, 500.4501, and 500.4503), the title as

 

amended by 2002 PA 304, section 2111 as amended by 2012 PA 441,

 

sections 3101 and 3113 as amended by 2016 PA 346, section 3104 as

 

amended by 2002 PA 662, section 3107 as amended by 2012 PA 542,

 

section 3109a as amended by 2012 PA 454, section 3114 as amended by

 

2016 PA 347, section 3135 as amended by 2012 PA 158, section 3163

 

as amended by 2002 PA 697, section 3330 as amended by 2012 PA 204,

 

and sections 4501 and 4503 as amended by 2012 PA 39, and by adding

 

sections 1245, 3107c, 3157a, 3180, and 4505 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. 1245. (1) An insurance producer, including, but not

 

limited to, a producing agency, or an employee or agent of an

 

insurance producer is not liable for damages caused by the conduct

 

of the producer, employee, or agent related to obtaining or

 

providing information, or the choice of personal protection

 

insurance benefits by an insured, under section 3107c or 3109a.

 

     (2) This section does not apply with respect to a policy

 

issued or renewed after 3 years after the effective date of the

 

amendatory act that added this section.

 

     Sec. 2111. (1) Notwithstanding any provision of this act or

 

this chapter to the contrary, classifications and territorial base

 

rates used by an insurer in this state with respect to automobile

 

insurance or home insurance shall must conform to the applicable

 

requirements of this section.

 

     (2) Classifications established under this section for

 

automobile insurance shall must be based only on 1 or more of the

 

following factors, which the insurer shall be applied by an insurer

 

apply on a uniform basis throughout this state:

 

     (a) With respect to all automobile insurance coverages:

 

     (i) Either the age of the driver; the length of driving

 

experience; or the number of years licensed to operate a motor

 

vehicle.

 

     (ii) Driver primacy, based on the proportionate use of each

 

vehicle insured under the policy by individual drivers insured or

 

to be insured under the policy.

 

     (iii) Average miles driven weekly, annually, or both.


     (iv) Type of use, such as business, farm, or pleasure use.

 

     (v) Vehicle characteristics, features, and options, such as

 

engine displacement, ability of the vehicle and its equipment to

 

protect passengers from injury, and other similar items, including

 

vehicle make and model.

 

     (vi) Daily or weekly commuting mileage.

 

     (vii) Number of cars insured by the insurer or number of

 

licensed operators in the household. However, the insurer shall not

 

use the number of licensed operators shall not be used as an

 

indirect measure of marital status.

 

     (viii) Amount of insurance.

 

     (b) In addition to the factors prescribed in subdivision (a),

 

with respect to personal protection insurance coverage:

 

     (i) Earned income.

 

     (ii) Number of dependents of income earners insured under the

 

policy.

 

     (iii) Coordination of benefits.

 

     (iv) Use of a safety belt.

 

     (c) In addition to the factors prescribed in subdivision (a),

 

with respect to collision and comprehensive coverages:

 

     (i) The anticipated cost of vehicle repairs or replacement,

 

which may be measured by age, price, cost new, or value of the

 

insured automobile, and other factors directly relating to that

 

anticipated cost.

 

     (ii) Vehicle make and model.

 

     (iii) Vehicle design characteristics related to vehicle

 

damageability.


     (iv) Vehicle characteristics relating to automobile theft

 

prevention devices.

 

     (d) With respect to all automobile insurance coverage other

 

than comprehensive, successful completion by the individual driver

 

or drivers insured under the policy of an accident prevention

 

education course that meets the following criteria:

 

     (i) The course shall must include a minimum of 8 hours of

 

classroom instruction.

 

     (ii) The course shall must include, but not be limited to, a

 

review of all of the following:

 

     (A) The effects of aging on driving behavior.

 

     (B) The shapes, colors, and types of road signs.

 

     (C) The effects of alcohol and medication on driving.

 

     (D) The laws relating to the proper use of a motor vehicle.

 

     (E) Accident prevention measures.

 

     (F) The benefits of safety belts and child restraints.

 

     (G) Major driving hazards.

 

     (H) Interaction with other highway users, such as

 

motorcyclists, bicyclists, and pedestrians.

 

     (3) Each An insurer shall establish a secondary or merit

 

rating plan for automobile insurance, other than comprehensive

 

coverage. A secondary or merit rating plan required under this

 

subsection shall must provide for premium surcharges for any or all

 

coverages for automobile insurance, other than comprehensive

 

coverage, based upon on any or all of the following, when that

 

information becomes available to the insurer:

 

     (a) Substantially at-fault accidents.


     (b) Convictions for, determinations of responsibility for

 

civil infractions for, or findings of responsibility in probate

 

court for civil infractions for violations under chapter VI of the

 

Michigan vehicle code, 1949 PA 300, MCL 257.601 to 257.750.

 

However, an insured shall not be merit rated for a civil infraction

 

under chapter VI of the Michigan vehicle code, 1949 PA 300, MCL

 

257.601 to 257.750, for a period of time longer than that which the

 

secretary of state's office carries points for that infraction on

 

the insured's motor vehicle record.

 

     (4) An insurer shall not establish or maintain rates or rating

 

classifications for automobile insurance based on sex or marital

 

status. This subsection applies regardless of anything in this act

 

to the contrary, including, but not limited to, anything in

 

sections 2109 to 2110a or subsection (9).

 

     (5) Notwithstanding other provisions of this chapter,

 

automobile insurance risks may be grouped by territory.

 

     (6) This section does not limit insurers or rating

 

organizations from establishing and maintaining statistical

 

reporting territories. This section does not prohibit an insurer

 

from establishing or maintaining, for automobile insurance, a

 

premium discount plan for senior citizens in this state who are 65

 

years of age or older, if the plan is uniformly applied by the

 

insurer throughout this state. If an insurer has not established

 

and maintained a premium discount plan for senior citizens, the

 

insurer shall offer reduced premium rates to senior citizens in

 

this state who are 65 years of age or older and who drive less than

 

3,000 miles per year, regardless of statistical data.


     (7) Classifications established under this section for home

 

insurance other than inland marine insurance provided by policy

 

floaters or endorsements shall must be based only on 1 or more of

 

the following factors:

 

     (a) Amount and types of coverage.

 

     (b) Security and safety devices, including locks, smoke

 

detectors, and similar, related devices.

 

     (c) Repairable structural defects reasonably related to risk.

 

     (d) Fire protection class.

 

     (e) Construction of structure, based on structure size,

 

building material components, and number of units.

 

     (f) Loss experience of the insured, based on prior claims

 

attributable to factors under the control of the insured that have

 

been paid by an insurer. An insured's failure, after written notice

 

from the insurer, to correct a physical condition that presents a

 

risk of repeated loss shall be considered is a factor under the

 

control of the insured for purposes of this subdivision.

 

     (g) Use of smoking materials within the structure.

 

     (h) Distance of the structure from a fire hydrant.

 

     (i) Availability of law enforcement or crime prevention

 

services.

 

     (8) Notwithstanding other provisions of this chapter, home

 

insurance risks may be grouped by territory.

 

     (9) An insurer may use factors in addition to those permitted

 

by this section for insurance if the plan is consistent with the

 

purposes of this act and reflects reasonably anticipated reductions

 

or increases in losses or expenses.


     Sec. 3101. (1) 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 benefits

 

payable under section 3107 up to any limit on benefits applicable

 

under section 3109a and subject to any exclusion of a qualified

 

person under section 3107c, property protection insurance, and

 

residual liability insurance coverage required under section 3009.

 

Security 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 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) "Emergency medical condition" means that term as defined

 

in section 1395dd of the social security act, 42 USC 1395dd, as

 

determined and documented by a qualified medical professional.

 

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

 

transportation while playing the game of golf.

 

     (e) (d) "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) "Household" means a house, an apartment, a mobile home, or

 

any other structure or part of a structure intended for residential

 

occupancy as separate living quarters.

 

     (g) (e) "Moped" means that term as defined in section 32b of

 

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

 

     (h) (f) "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.

 

     (i) (g) "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.

 

     (j) (h) "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.

 

     (k) (i) "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.

 

     (l) (j) "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.

 

     (m) (k) "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.

 

     (n) (l) "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.

 

     (o) "Qualified medical professional" means any of the

 

following:

 

     (i) A physician as that term is defined in sections 17001 and

 

17501 of the public health code, 1978 PA 368, MCL 333.17001 and

 

333.17501.

 

     (ii) A physician's assistant licensed under article 15 of the

 

public health code, 1978 PA 368, MCL 333.16101 to 333.18838, under

 

that health profession subfield of the practice of medicine or the

 

practice of osteopathic medicine and surgery.

 

     (iii) A dentist as that term is defined in section 16601 of

 

the public health code, 1978 PA 368, MCL 333.16601.

 

     (iv) An advanced practice registered nurse as that term is

 

defined in section 17201 of the public health code, 1978 PA 368,

 

MCL 333.17201.

 

     (p) (m) "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.

 

     (q) "Related emergency care" means a reasonably necessary in-

 

patient treatment, product, service, or accommodation related to,

 

immediately following, and necessitated by an emergency medical

 

condition as determined and documented by a qualified medical

 

professional.


     (r) "Related person" means the spouse, a child, or a relative

 

who is related to the person within the seventh degree of

 

consanguinity, as computed by the civil law method.

 

     (s) "Ultimate loss" means the actual loss amounts paid or

 

payable by a member of the association created under section 3104.

 

Ultimate loss does not include claim expenses.

 

     (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. 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 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

 

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 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.

 

     (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, 2019, $555,000.00.

 

Beginning July 1, 2013, 2019, this $500,000.00 $555,000.00 amount

 

shall must 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 The association shall

 

calculate the biennial adjustment shall be calculated by the

 

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


     (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 must 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 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 must 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 relating

 

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 total premium shall

 

must include an amount to cover incurred but not reported losses

 

for the period and may must be adjusted for any excess or deficient

 

premiums from previous periods. Excesses or deficiencies from

 

previous periods may must either 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, with the total written car years of insurance multiplied

 

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

 

car shall be is the total premium, calculated as adjusted for any


excesses or deficiencies, divided by the total written car years of

 

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

 

3103(1), or both, written in this state of all members during the

 

period to which the premium applies, excluding cars insured under a

 

policy with a coverage limit under section 3109a(2)(a) or (b)

 

except for any portion of total premium that is an adjustment for a

 

deficiency in a previous period. A member may not be charged a

 

premium for a car insured under a policy with a coverage limit

 

under section 3109a(2)(a) or (b) other than for the portion of the

 

total premium attributable to an adjustment for a deficiency in a

 

previous period. 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. Not less than 60

 

days before a change in the total premium is effective, the

 

association shall provide the director of the department with a

 

written report on the new premium amount, the change in the premium

 

amount from the previous period, and an explanation detailing the

 

reasons for the change, including a justification of any adjustment

 

for any excesses or deficiencies from previous periods. 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.

 

     (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 requiring that any portion of the premium

 

payable by a member of the association passed on to an insured for

 

a car equal the portion of the premium payable by the member

 

attributable to that car under this section, including any

 

adjustments for excesses or deficiencies from previous periods. As

 

used in this subdivision and subdivision (e), "car" means that term

 

as defined in subsection (7)(d).

 

     (e) Procedures for a rebate of a surplus to members of the

 

association, for distribution to insureds as provided in subsection

 

(24), as ordered by the director of the department under subsection

 

(22) or as directed by the association during any period in which

 

the association charges no premium because of excesses from

 

previous periods, if the rebate directed by the association will

 

not threaten the association's ongoing ability to provide an

 

effective reinsurance mechanism for personal protection insurance

 

benefits based on generally accepted and reasonable actuarial

 

techniques. As used in this subdivision, "surplus" means any

 

excesses from previous periods not reserved by the association to

 

cover the expected losses and expenses of the association that the

 

association likely will incur during the period for which a premium

 

is applicable under subsection (7)(d). Surplus does not include

 

excesses from previous periods adjusted over 5 or more years in the

 

manner provided in the plan of operation under subsection (7)(d).

 

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

 

the association.

 

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


association for actual and necessary expenses incurred on

 

association business.

 

     (h) (f) The investment policy of the association.

 

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

 

effectively implement this section.

 

     (11) Each The board shall must include members that would

 

contribute a total of not less than 40% of the total premium

 

calculated pursuant to under subsection (7)(d). Each director shall

 

be board member is entitled to 1 vote. The initial term of office

 

of a director shall be board member 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 and the terms of board members, consistent with

 

the membership composition requirements in subsections (11) and

 

(13). Terms of the directors shall board members must be staggered

 

so that the terms of all the directors board members do not expire

 

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

 

a term of more than 4 years.

 

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

 

members and the commissioner director of the department, who shall

 

be serve as an ex officio member of the board without vote.

 

     (14) Each director The director of the department shall be

 

appointed by the commissioner and appoint the board members. A

 

board member shall serve until that member's his or her successor

 

is selected and qualified. The board shall elect the chairperson of

 

the board. shall be elected by the board. A 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. board members. The

 

chairperson shall retain the right to may vote on all issues. Four

 

members of the board board members constitute a quorum.

 

     (16) An The board shall furnish to each member an annual

 

report of the operations of the association in a form and detail as

 

may be determined by the board. shall 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, including, but not

 

limited to, any change relating to adjustments for excesses or

 

deficiencies under subsection (7)(d) or a procedure under

 

subsection (10)(d) or (10)(e), are subject to majority approval by

 

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

 

the association 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 An insurer authorized to write

 

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

 

this state, as provided in this section, 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) (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 is a member

 

of the association.


     (20) (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.

 

     (21) (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. Beginning July 1, 2018, and

 

every fifth year after 2018, the director of the department shall

 

engage 1 or more independent actuaries to examine the affairs and

 

records of the association relating to premiums charged to members

 

of the association under subsection (7)(d), adjustments to premiums

 

for any excesses or deficiencies under subsection (7)(d), and any

 

rebates under subsection (10)(e), during the previous 5 years. By

 

December 31, 2018 and by December 31 of every fifth year after

 

2018, the director of the department shall report to the governor

 

and the standing committees of the senate and house of

 

representatives with primary jurisdiction over insurance issues on

 

all of the following relating to the 5-year period ending on the

 

previous June 30:

 

     (a) The association's compliance with the requirements of this

 

section and its plan of operation relating to the association's

 

calculation of premiums charged under subsection (7)(d), including

 

any adjustments for excesses or deficiencies from previous periods.

 

     (b) The expectations used by the association for medical cost

 

inflation, economic conditions, investment return, and the number

 

of claims presented to the association.


     (c) The association's compliance with subsection (10)(d) and

 

(e).

 

     (d) The association's compliance with generally accepted and

 

reasonable actuarial techniques in determining premium charges and

 

any adjustments for excesses or deficiencies from prior periods

 

under subsection (7)(d).

 

     (e) The effect of any rebate under subsection (10)(e) and

 

distribution under subsection (24) on the association's ongoing

 

ability to provide an effective reinsurance mechanism for personal

 

protection insurance benefits.

 

     (22) If the actuarial examination under subsection (21) shows

 

that the assets of the association exceed 120% of its liabilities,

 

including incurred but not reported liabilities, the director of

 

the department shall order the association to rebate the excess

 

under subsection (10)(e) and the members of the association to

 

distribute the rebates under subsection (24).

 

     (23) Within 30 days after receiving an order from the director

 

of the department under subsection (22), the association may

 

request a hearing to review the order by filing a written request

 

with the director of the department. The department shall conduct

 

the review as a contested case under the administrative procedures

 

act of 1969, 1969 PA 306, MCL 24.201 to 24.328.

 

     (24) A member of the association shall distribute any rebate

 

it receives under subsection (10)(e) to the person that it insures

 

under policies that provide the security required under section

 

3101(1) or 3103(1), or both, on a uniform basis per car in a manner

 

and on the date or dates provided by the director of the department


in accordance with an order issued by the director. As used in this

 

subsection, "car" means that term as defined in subsection (7)(d).

 

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

 

occurring before July 1, 1978. After June 30, 2018, the association

 

does not have liability for an ultimate loss under personal

 

protection insurance coverage for a motor vehicle accident policy

 

if a coverage limit under section 3109a(2)(a) or (b) is effective

 

for the policy at the time of the ultimate loss. An ultimate loss

 

is incurred by the association on the date that the ultimate loss

 

occurs.

 

     (26) For purposes of this section, the date that a motor

 

vehicle accident policy is issued or renewed is the effective date

 

of personal protection insurance coverage under the policy.

 

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

 

     (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) (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 before

 

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

 

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

 

by the United States department of labor, bureau of labor

 

statistics, Department of Labor, Bureau of Labor Statistics, and as

 

certified by the commissioner.director of the department.

 

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


providing the coverages required under section 3101(1).

 

     (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. 3107. (1) Except as provided in subsection (2), this

 

section and sections 3107a to 3107c, personal protection insurance

 

benefits are payable for the following:

 

     (a) Allowable expenses consisting of all reasonable charges

 

incurred, up to any coverage limit applicable under this section or

 

section 3109a, for reasonably necessary products, services and

 

accommodations for an injured person's care, recovery, or

 

rehabilitation. Allowable expenses within personal protection

 

insurance coverage shall do not include either any of the

 

following:

 

     (i) Charges for a hospital room in excess of a reasonable and

 

customary charge for semiprivate accommodations, except if unless

 

the injured person requires special or intensive care.

 

     (ii) Funeral and burial expenses in excess of the amount set

 

forth in the policy which shall must not be less than $1,750.00 or

 

more than $5,000.00.

 

     (iii) A charge that is not related to or necessitated by the

 

injury covered by the personal protection benefits.

 

     (b) Work loss consisting of loss of income from work an

 

injured person would have performed during the first 3 years after

 

the date of the accident if he or she had not been injured. Work

 

loss does not include any loss after the date on which the injured


person dies. Because the benefits received from personal protection

 

insurance for loss of income are not taxable income, the benefits

 

payable for such loss of income shall must be reduced 15% unless

 

the claimant presents to the insurer in support of his or her claim

 

reasonable proof of a lower value of the income tax advantage in

 

his or her case, in which case the lower value shall apply. must be

 

applied. For the period beginning October 1, 2012 through September

 

30, 2013, the benefits payable for work loss sustained in a single

 

30-day period and the income earned by an injured person for work

 

during the same period together shall must not exceed $5,189.00,

 

which maximum shall apply must be applied pro rata to any lesser

 

period of work loss. Beginning October 1, 2013, the maximum shall

 

must be adjusted annually to reflect changes in the cost of living

 

under rules prescribed by the commissioner director, but any change

 

in the maximum shall apply applies only to benefits arising out of

 

accidents occurring subsequent to an accident that occurs after the

 

date of change in the maximum.

 

     (c) Expenses not exceeding $20.00 per day, reasonably incurred

 

in obtaining ordinary and necessary services in lieu of those that,

 

if he or she had not been injured, an injured person would have

 

performed during the first 3 years after the date of the accident,

 

not for income but for the benefit of himself or herself or of his

 

or her dependent.

 

     (2) Both All of the following apply to personal protection

 

insurance benefits payable under subsection (1):

 

     (a) A person who is 60 years of age or older and in the event

 

of an accidental bodily injury would not be eligible to receive


work loss benefits under subsection (1)(b) may waive coverage for

 

work loss benefits by signing a waiver on a form provided by the

 

insurer. An insurer shall offer a reduced premium rate to a person

 

who waives coverage under this subsection for work loss benefits.

 

Waiver of coverage for work loss benefits applies only to work loss

 

benefits payable to the person or persons who have signed the

 

waiver form.

 

     (b) An insurer shall is not be required to provide coverage

 

for the medical use of marihuana or for expenses related to the

 

medical use of marihuana.

 

     (c) An insurer is not required to provide coverage for more

 

than a cumulative 56 hours per injured person per week of attendant

 

care in the home if the attendant care is provided directly, or

 

indirectly through another person, by any of the following:

 

     (i) A related person of the injured person.

 

     (ii) A person domiciled in the household of the injured

 

person.

 

     (iii) A person with whom the injured person had a business or

 

social relationship before the injury.

 

     (d) An insurer is not required to provide coverage for ground

 

transportation services other than ambulance services described in

 

subdivision (e) in an amount that exceeds 300% of the optional

 

standard mileage rate provided by the Internal Revenue Service for

 

use in calculating the deductible cost of operating an automobile

 

for medical care described in section 213 of the internal revenue

 

code of 1986, 26 USC 213. Every second year after December 31,

 

2020, the director shall review any changes to the optional


standard mileage rate provided by the Internal Revenue Service for

 

use in calculating the deductible cost of operating an automobile

 

for medical care described in section 213 of the internal revenue

 

code, 26 USC 213. If the director determines that the changes to

 

the optimal standard mileage rate provided by the Internal Revenue

 

Service are reasonable and appropriate for purposes of assuring

 

affordable automobile insurance in this state, the changes apply

 

for purposes of this subdivision and the director shall issue an

 

order to that effect.

 

     (e) An insurer is not required to provide coverage for

 

ambulance services, including, but not limited to, air ambulance

 

services, in an amount that exceeds the amount that would be

 

allowable for the ambulance services under the ambulance fee

 

schedule applicable to ambulance services under part B of the

 

federal Medicare program established under title XVIII of the

 

social security act, 42 USC 1395 to 1395lll. Every second year

 

after December 31, 2020, the director shall review any changes to

 

amounts payable under the ambulance fee schedule applicable to

 

ambulance services under part B of the federal Medicare program

 

established under subchapter XVIII of the social security act, 42

 

USC 1395 to 1395lll. If the director determines that the changes to

 

amounts payable under the ambulance fee schedule applicable to

 

ambulance services under part B are reasonable and appropriate for

 

purposes of assuring affordable automobile insurance in this state,

 

the changes apply for purposes of this subdivision and the director

 

shall issue an order to that effect.

 

     (f) A claim for ground transportation services or ambulance


services must identify the provider of the services, each location

 

at which the injured person was picked up by the provider, each

 

location at which the injured person was dropped off by the

 

provider, the mileage between each location, and the total mileage

 

for each day in which a claim for transportation or ambulance

 

services is made.

 

     (3) With respect to personal protection insurance benefits for

 

attendant care in the home, ground transportation services

 

described in subsection (2)(d), and ambulance services described in

 

subsection (2)(e), an insurer is only required to pay reasonable

 

charges incurred for reasonably necessary products, services, and

 

accommodations for an injured person's care, recovery, or

 

rehabilitation related to and necessitated by the injury covered by

 

the personal protection insurance benefits, up to any coverage

 

limit applicable under subsection (2) or section 3109a.

 

     (4) Subsection (2)(c) does not prohibit an insurer from paying

 

personal protection insurance benefits for more than 56 hours per

 

week of attendant care provided in the home by a person described

 

in subsection (2)(c)(i) to (iii).

 

     Sec. 3107c. (1) For insurance policies issued or renewed after

 

June 30, 2018, a qualified person who is an insured person under

 

the policy is not entitled to personal protection insurance

 

benefits under section 3107(1)(a) unless the qualified person

 

affirmatively elects to purchase personal protection insurance

 

benefits coverage under this section.

 

     (2) For automobile insurance policies issued or renewed after

 

June 30, 2018, each person who is 62 years of age or older shall


complete a form, approved by the director, to certify whether he or

 

she is a qualified person. The form also must provide a qualified

 

person the option to purchase personal protection insurance

 

benefits for the qualified person notwithstanding his or her status

 

as a qualified person and disclose in a conspicuous manner that a

 

qualified person is not obligated to purchase personal protection

 

insurance coverage for the qualified person.

 

     (3) A qualified person who opts to purchase personal

 

protection insurance under this section shall select a coverage

 

level under section 3109a(2). If a qualified person does not opt to

 

purchase personal protection insurance benefits for the qualified

 

person, the automobile insurance policy must include personal

 

protection insurance payable under the policy only for other

 

persons who have a right to claim personal protection insurance

 

benefits under the policy up to the coverage limits under section

 

3109a(2)(a) and not for the qualified person.

 

     (4) An insurer shall offer a reduced automobile insurance

 

premium rate for any automobile insurance policy that excludes

 

personal protection insurance coverage for a qualified person under

 

this section.

 

     (5) If an insured is 62 years of age or older and does not

 

provide an insurer with the form required by this section, the

 

insured shall purchase automobile insurance with personal

 

protection insurance coverage as otherwise provided under this

 

chapter.

 

     (6) If a qualified person provides the certification required

 

under this section to an insurer and does not opt to purchase


personal protection insurance benefits in compliance with this

 

section, the insurer is discharged from any liability for personal

 

protection insurance benefits under this chapter for the qualified

 

person.

 

     (7) As used in this section:

 

     (a) "Qualified health coverage" means health insurance or

 

health benefits that satisfy both of the following requirements:

 

     (i) The health insurance or health benefits are provided under

 

a private or public retirement program for the remainder of the

 

qualified person's life.

 

     (ii) Coverage is included for accidental bodily injury arising

 

out of the ownership, operation, maintenance, or use of a motor

 

vehicle as a motor vehicle.

 

     (b) "Qualified person" means a person who is 62 years of age

 

or older who has qualified health coverage.

 

     Sec. 3109a. (1) An insurer providing personal protection

 

insurance benefits under this chapter may offer, at appropriately

 

reduced premium rates, deductibles and exclusions reasonably

 

related to other health and accident coverage on the insured. Any

 

deductibles and exclusions offered under this section are subject

 

to prior approval by the commissioner director and shall must apply

 

only to benefits payable to the insured person named in the policy,

 

the spouse of the insured person, and any relative of either

 

domiciled in the same household.

 

     (2) For an insurance policy that provides personal protection

 

insurance benefits and is issued or renewed after June 30, 2018,

 

the insured person named in the policy shall select 1 of the


following coverage levels for the personal protection insurance

 

benefits:

 

     (a) A limit of $250,000.00 per individual per loss occurrence,

 

consisting of both of the following:

 

     (i) Up to $225,000.00 per individual per loss occurrence for

 

an emergency medical condition and related emergency care only.

 

     (ii) Up to $25,000.00 per individual for all other personal

 

protection insurance benefits under this chapter.

 

     (b) A limit of $500,000.00 per individual per loss occurrence

 

on personal protection insurance benefits under this chapter.

 

     (c) No maximum limit per individual per loss occurrence on

 

personal protection insurance benefits under this chapter.

 

     (3) All of the following apply to subsection (2):

 

     (a) If an insured person named in the policy does not select

 

in writing on a form approved by the director 1 of the coverage

 

levels under subsection (2), no maximum limit on personal

 

protection insurance benefits under this chapter applies under the

 

policy. However, if an insured person named in the policy has

 

previously selected as provided in this subdivision 1 of the 2

 

coverage levels under subsection (2) and does not, before renewal

 

of the policy, select a different coverage level in writing on a

 

form approved by the director, the coverage level applicable before

 

the renewal applies under the policy.

 

     (b) If the insured person named in the policy selects a

 

coverage limit under subsection (2)(a) or (b), the coverage limit

 

under subsection (2)(a) or (b) applies to personal protection

 

insurance benefits payable under the policy to the insured person,


the insured person's spouse, a relative of either domiciled in the

 

same household, and any other person with a right to claim personal

 

protection insurance benefits under the policy.

 

     (c) If the insured person named in the policy does not select

 

a coverage limit under subsection (2)(a) or (b) for a policy, no

 

maximum limit applies to personal protection insurance benefits

 

payable under the policy to the insured person, the insured

 

person's spouse, a relative of either domiciled in the same

 

household, or any other resident of this state with a right to

 

claim personal protection benefits under the policy. The coverage

 

limit under section 3163(4) applies to a nonresident of this state

 

with a right to claim personal protection benefits under the policy

 

if the nonresident is not the insured named in the policy, the

 

insured person's spouse, or a relative of either domiciled in the

 

same household.

 

     (d) If the coverage limit under subsection (2)(a) or (b) or

 

section 3163(4) applies to a person claiming personal protection

 

insurance benefits, the coverage limit applies on a per occurrence

 

per loss basis notwithstanding the number of policies applicable to

 

the occurrence or the loss.

 

     (e) Other limits on personal protection insurance benefits

 

provided in this chapter, including, but not limited to, limits

 

under section 3163, continue to apply to personal protection

 

insurance benefits coverage notwithstanding the applicability of a

 

coverage limit under this section.

 

     (4) For purposes of this section, the date that a policy is

 

issued or renewed is the effective date of both the personal


protection insurance coverage under the policy and the coverage

 

level applicable under this section.

 

     Sec. 3113. A person is not entitled to be paid personal

 

protection insurance benefits for accidental bodily injury if at

 

the time of the accident any of the following circumstances

 

existed:

 

     (a) The person was willingly operating or willingly using a

 

motor vehicle or motorcycle that was taken unlawfully, and the

 

person knew or should have known that the motor vehicle or

 

motorcycle was taken unlawfully.

 

     (b) The person was the owner or registrant of a motor vehicle

 

or motorcycle involved in the accident with respect to which the

 

security required by section 3101 or 3103 was not in effect.

 

     (c) The person was not a resident of this state, was an

 

occupant of a motor vehicle or motorcycle not registered in this

 

state, and the motor vehicle or motorcycle was not insured by an

 

insurer that has filed a certification in compliance with section

 

3163.

 

     (d) The person was operating a motor vehicle or motorcycle as

 

to which he or she was named as an excluded operator as allowed

 

under section 3009(2).

 

     (e) The person was the owner or operator of a motor vehicle

 

for which coverage was excluded under a policy exclusion authorized

 

under section 3017.

 

     (f) The person was a qualified person who did not purchase

 

personal protection insurance benefits under section 3107c.

 

     Sec. 3114. (1) Except as provided in subsections (2), (3), and


(5), a personal protection insurance policy described in section

 

3101(1) applies to accidental bodily injury to the person named in

 

the policy, the person's spouse, and a relative of either domiciled

 

in the same household, if the injury arises from a motor vehicle

 

accident. A personal injury insurance policy described in section

 

3103(2) applies to accidental bodily injury to the person named in

 

the policy, the person's spouse, and a relative of either domiciled

 

in the same household, if the injury arises from a motorcycle

 

accident. If personal protection insurance benefits or personal

 

injury benefits described in section 3103(2) are payable to or for

 

the benefit of an injured person under his or her own policy and

 

would also be payable under the policy of his or her spouse,

 

relative, or relative's spouse, the injured person's insurer shall

 

pay all of the benefits and is not entitled to recoupment from the

 

other insurer. Except as provided in section 3107c, a coverage

 

limit applicable to a personal protection insurance policy under

 

section 3109a(2) applies to personal protection insurance benefits

 

payable for accidental bodily injury to the person named in the

 

policy, the person's spouse, and a relative of either domiciled in

 

the same household, if the injury arises from a motor vehicle

 

accident.

 

     (2) A person suffering accidental bodily injury while an

 

operator or a passenger of a motor vehicle operated in the business

 

of transporting passengers shall receive the personal protection

 

insurance benefits to which the person is entitled from the insurer

 

of the motor vehicle. This subsection does not apply to a passenger

 

in any of the following, unless the passenger is not entitled to


personal protection insurance benefits under any other policy:

 

     (a) A school bus, as defined by the department of education,

 

providing transportation not prohibited by law.

 

     (b) A bus operated by a common carrier of passengers certified

 

by the department of transportation.

 

     (c) A bus operating under a government sponsored

 

transportation program.

 

     (d) A bus operated by or providing service to a nonprofit

 

organization.

 

     (e) A taxicab insured as prescribed in section 3101 or 3102.

 

     (f) A bus operated by a canoe or other watercraft, bicycle, or

 

horse livery used only to transport passengers to or from a

 

destination point.

 

     (g) A transportation network company vehicle.

 

     (3) An employee, his or her spouse, or a relative of either

 

domiciled in the same household, who suffers accidental bodily

 

injury while an occupant of a motor vehicle owned or registered by

 

the employer, shall receive personal protection insurance benefits

 

to which the employee is entitled from the insurer of the furnished

 

vehicle.

 

     (4) Except as provided in subsections (1) to (3), a person

 

suffering accidental bodily injury arising from a motor vehicle

 

accident while an occupant of a motor vehicle shall claim personal

 

protection insurance benefits from insurers in the following order

 

of priority:

 

     (a) The insurer of the owner or registrant of the vehicle

 

occupied.


     (b) The insurer of the operator of the vehicle occupied.

 

     (5) A person suffering accidental bodily injury arising from a

 

motor vehicle accident that shows evidence of the involvement of a

 

motor vehicle while an operator or passenger of a motorcycle shall

 

claim personal protection insurance benefits from insurers in the

 

following order of priority:

 

     (a) The insurer of the owner or registrant of the motor

 

vehicle involved in the accident, subject to the applicable

 

coverage level for personal protection insurance benefits under

 

section 3109a(2).

 

     (b) The insurer of the operator of the motor vehicle involved

 

in the accident, subject to the applicable coverage level for

 

personal protection insurance benefits under section 3109a(2).

 

     (c) The motor vehicle insurer of the operator of the

 

motorcycle involved in the accident.

 

     (d) The motor vehicle insurer of the owner or registrant of

 

the motorcycle involved in the accident.

 

     (6) If 2 or more insurers are in the same order of priority to

 

provide personal protection insurance benefits under subsection

 

(5), an insurer paying benefits due is entitled to partial

 

recoupment from the other insurers in the same order of priority,

 

and a reasonable amount of partial recoupment of the expense of

 

processing the claim, in order to accomplish equitable distribution

 

of the loss among all of the insurers, subject to the applicable

 

coverage level for personal protection insurance benefits under

 

section 3109a(2).

 

     (7) Notwithstanding anything in this chapter to the contrary,


a coverage limit under section 3109a(2) or section 3163(4) applies

 

on a per occurrence per loss basis notwithstanding the number of

 

policies applicable to the occurrence or the loss.

 

     (8) (7) As used in this section:

 

     (a) "Personal vehicle", "prearranged ride", and

 

"transportation network company digital network" mean those terms

 

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

 

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

 

     (b) "Transportation network company vehicle" means a personal

 

vehicle while the driver is logged on to the transportation network

 

company digital network or while the driver is engaged in a

 

prearranged ride.

 

     Sec. 3135. (1) A person 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 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.

 

     (d) The issue of whether the injured person has sustained a

 

serious impairment of bodily function is fact-specific and must be

 

determined on a case-by-case basis.

 

     (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:

 

     (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 under 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 impairment that satisfies all of the following

 

requirements:

 

     (a) It is objectively manifested, meaning it is observable or

 

perceivable from actual symptoms or conditions.

 

     (b) It is an impairment of an important body function, that

 

which is a body function of value, significance, or consequence to

 

the injured person.

 

     (c) It affects the injured person's general ability to lead

 

his or her normal life, meaning it influences the injured person's

 

capacity to live in his or her normal manner of living.

 

     Sec. 3142. (1) Personal Subject to subsection 3157, personal

 

protection insurance benefits are payable as loss accrues.

 

     (2) Personal protection insurance benefits are overdue if not

 

paid within 30 days after an insurer receives reasonable proof of

 

the fact and of the amount of loss sustained and any applicable


requirement under section 3157 is satisfied. If any applicable

 

requirement under section 3157 is satisfied but reasonable proof is

 

not supplied as to the entire claim, the amount supported by

 

reasonable proof is overdue if not paid within 30 days after the

 

proof is received by the insurer. Any part of the remainder of the

 

claim that is later supported by reasonable proof is overdue if not

 

paid within 30 days after the proof is received by the insurer. For

 

the purpose of calculating the extent to which benefits are

 

overdue, payment shall must be treated as made on the date a draft

 

or other valid instrument was placed in the United States mail in a

 

properly addressed, postpaid envelope, or, if not so posted, on the

 

date of delivery.

 

     (3) An overdue payment bears simple interest at the rate of

 

12% per annum.

 

     (4) A payment is not overdue if the insurer has reasonable

 

proof that the insurer is not responsible for the payment.

 

     Sec. 3148. (1) An Subject to subsections (5) and (6), an

 

attorney is entitled to may be awarded a reasonable fee for

 

advising and representing a claimant in an action for personal or

 

property protection insurance benefits which that are overdue. The

 

attorney's fee shall be is a charge against the insurer in addition

 

to the benefits recovered, if the court finds that the insurer

 

unreasonably refused to pay the claim or unreasonably delayed in

 

making proper payment. An attorney advising or representing an

 

injured person concerning a claim for payment of personal

 

protection insurance benefits from an insurer shall not claim,

 

file, or serve a lien for payment of a fee or fees until all of the


following apply:

 

     (a) A payment for the claim is authorized under this chapter.

 

     (b) A payment for the claim is overdue under this chapter.

 

     (c) The attorney notifies the resident agent of the insurer in

 

writing that the payment for the claim is overdue under this

 

chapter.

 

     (d) Within 30 days after the insurer receives the notice under

 

subdivision (c), the insurer does not either provide reasonable

 

proof that the insurer is not responsible for the payment or take

 

remedial action.

 

     (2) If an attorney claims, files, serves, or enforces a lien

 

in a manner prohibited by subsection (1), an insurer or other

 

person aggrieved by the lien is entitled to court costs and

 

reasonable attorney fees related to opposition of the imposition of

 

the lien.

 

     (3) (2) An A court may award an insurer may be allowed by a

 

court an award of a reasonable sum amount against a claimant as an

 

attorney's attorney fee for the insurer's attorney in defense

 

defending against a any of the following:

 

     (a) A claim that was in some respect fraudulent or so

 

excessive as to have no reasonable foundation.

 

     (b) A claim for benefits for a treatment, product, service,

 

rehabilitative occupational training, or accommodation that was not

 

medically necessary or that was for an excessive amount.

 

     (c) A claim for which the client was solicited by the attorney

 

in violation of the law of this state or the Michigan rules of

 

professional conduct.


     (4) To the extent that personal or property protection

 

insurance benefits are then due or thereafter come due to the

 

claimant because of loss resulting from the injury on which the

 

claim is based, such a an attorney fee awarded in favor of the

 

insurer may be treated taken as an offset against such the

 

benefits. ; also, judgment Judgment may also be entered against the

 

claimant for any amount of a an attorney fee awarded against him

 

and that is not offset in this way against benefits or otherwise

 

paid.

 

     (5) For a dispute over payment for allowable expenses under

 

section 3107(1)(a) for attendant care or nursing services, attorney

 

fees may be awarded in relation to expenses recovered for the 12

 

months preceding the date the insurer is notified of the dispute.

 

Attorney fees must not be awarded in relation to expenses paid

 

after the date the insurer is notified of the dispute, including

 

any future payments ordered after the judgment is entered.

 

     (6) A court shall not award a fee to an attorney for advising

 

or representing a claimant in an action for personal or property

 

protection insurance benefits for a treatment, product, service,

 

rehabilitative occupational training, or accommodation provided to

 

the claimant if the attorney or a related person of the attorney

 

has, or had at the time the treatment, product, service,

 

rehabilitative occupational training, or accommodation was

 

provided, a direct or indirect financial interest in the person

 

that provided the treatment, product, service, rehabilitative

 

occupational training, or accommodation. For purposes of this

 

subsection, a direct or indirect financial interest exists if the


person that provided the treatment, product, service,

 

rehabilitative occupational training, or accommodation makes a

 

direct or indirect payment or grants a financial incentive to the

 

attorney or a related person of the attorney relating to the

 

treatment, product, service, rehabilitative occupational training,

 

or accommodation within 24 months before or after the treatment,

 

product, service, rehabilitative occupational training, or

 

accommodation is provided.

 

     Sec. 3157. (1) A Subject to subsections (2) to (5), a

 

physician, hospital, clinic, or other person or institution

 

lawfully rendering treatment, products, services, or accommodations

 

to an injured person for an accidental bodily injury covered by

 

personal protection insurance, and a person or institution

 

providing rehabilitative occupational training to the injured

 

person following the injury, may charge a reasonable amount for the

 

treatment, training, products, services, and accommodations

 

rendered. The charge shall must not exceed the amount the person or

 

institution customarily charges for like treatment, training,

 

products, services, and accommodations in cases not involving that

 

do not involve personal protection insurance. A physician,

 

hospital, clinic, or other person or institution that received

 

payment or reimbursement of the amount authorized under this

 

chapter for a treatment, training, product, service, or

 

accommodation of an injured person for an accidental bodily injury

 

covered by personal protection insurance shall not charge or bill

 

the injured person any remaining balance or other additional amount

 

for the treatment, training, product, service, or accommodation.


     (2) A physician, hospital, clinic, or other person or

 

institution that renders a treatment, training, product, service,

 

or accommodation to an injured person for an accidental bodily

 

injury that is an emergency medical condition or rendering related

 

emergency care is not eligible for payment or reimbursement under

 

this chapter of more than 125% of the amount payable for the

 

treatment, training, product, service, or accommodation under part

 

A, B, or D of the federal Medicare program established under

 

subchapter XVIII of the social security act, 42 USC 1395 to

 

1395lll. Except as provided in subsection (3), in all other

 

circumstances a physician, hospital, clinic, or other person or

 

institution rendering a treatment, product, service, or

 

accommodation to an injured person for accidental bodily injury

 

covered by personal protection insurance, and a person or

 

institution providing rehabilitative occupational training to the

 

injured person following the injury, is not eligible for payment or

 

reimbursement under this chapter for more than the amount payable

 

for the treatment, training, product, service, or accommodation

 

under part A, B, or D of the federal Medicare program established

 

under subchapter XVIII of the social security act, 42 USC 1395 to

 

1395lll. Every year after December 31, 2020, the director shall

 

review any changes to amounts payable under part A, B, or D of the

 

federal Medicare program established under subchapter XVIII of the

 

social security act, 42 USC 1395 to 1395lll. If the director

 

determines that the changes are reasonable and appropriate for

 

purposes of assuring affordable automobile insurance in this state,

 

the changes apply for purposes of this subsection and the director


shall issue an order to that effect.

 

     (3) If part A, B, or D of the federal Medicare program

 

established under subchapter XVIII of the social security act, 42

 

USC 1395 to 1395lll, does not provide an amount payable for

 

treatment, training, product, service, or accommodation rendered to

 

an injured person for accidental bodily injury covered by personal

 

protection insurance or rehabilitative occupational training to the

 

injured person following the injury, the physician, hospital,

 

clinic, or other person or institution that renders the treatment,

 

product, service, or accommodation is not eligible for payment or

 

reimbursement under this chapter of more than the average amount

 

accepted by the physician, hospital, clinic, or other person or

 

institution as payment or reimbursement in full for the treatment,

 

training, product, service, or accommodation during the preceding

 

calendar year.

 

     (4) By rendering any treatment, products, services, or

 

accommodations to 1 or more injured persons for an accidental

 

bodily injury covered by personal protection insurance benefits

 

coverage under this chapter after the effective date of the

 

amendatory act that added this subsection, a physician, hospital,

 

clinic, or other person or institution is considered to have agreed

 

to timely submit to an insurer, the association created under

 

section 3104, or the department all information relating to a

 

treatment, product, service, or accommodation provided to an

 

injured person for accidental bodily injury covered by personal

 

protection insurance and relating to an average amount accepted for

 

the treatment, training, product, service, or accommodation under


subsection (3), including, but not limited to, all of the

 

following:

 

     (a) Diagnoses.

 

     (b) Scans and X-rays.

 

     (c) Notes of physicians, nurses, and other providers.

 

     (d) Progress, psychiatric, or other notes.

 

     (e) Patient history and physical reports.

 

     (f) Reports and records relating to consultations, autopsies,

 

operations, laboratory work, surgeries, recovery room activities,

 

and electroencephalograms.

 

     (g) Incident, triage, and pharmacy reports and records.

 

     (h) Documentation relating to therapy, including, but not

 

limited to, intravenous therapy, occupational or physical therapy,

 

respiratory therapy, and speech therapy.

 

     (i) Documents relating to billing and forms and documents

 

relating to the computation of charges and billing, including, but

 

not limited to, form CMS-1450, form CMS-1500, and form UB-04.

 

     (j) A determination of an emergency medical condition or

 

related emergency care.

 

     (5) A physician, hospital, clinic, or other person or

 

institution that renders a treatment, product, service, or

 

accommodation to an injured person for accidental bodily injury

 

covered by personal protection insurance, and a person or

 

institution that provides rehabilitative occupational training to

 

the injured person following the injury, is not eligible for

 

payment or reimbursement under this chapter for any of the

 

following:


     (a) A request for payment for a treatment, training, product,

 

service, or accommodation rendered if the request for payment is

 

based on the use of false or misleading records or information.

 

     (b) A treatment, training, product, service, or accommodation

 

that is not usually associated with, is materially longer in

 

duration than, is materially more frequent than, or extends over a

 

materially greater number of days than that treatment, training,

 

product, service, or accommodation usually required for a patient

 

with the diagnosis or condition of the injured person if no

 

specific written justification of the medical necessity of that

 

treatment, training, product, service, or accommodation is included

 

in the patient record for the injured person.

 

     (c) A treatment as to which evidence provided to the

 

physician, hospital, clinic, or other person or institution that

 

renders the treatment, product, service, or accommodation to an

 

injured person for accidental bodily injury covered by personal

 

protection insurance, or to the person or institution that provides

 

rehabilitative occupational training to the injured person,

 

indicates that the treatment, product, service, or accommodation

 

was not medically necessary given the physical capabilities of the

 

injured person.

 

     (6) If a person pays for or reimburses an amount not

 

authorized under subsection (5), the person may request a refund of

 

the amount paid. If the unauthorized amount is not refunded within

 

30 days, interest on the amount refundable must be paid to the

 

person at the rate of 1% of the amount of the refund owed per

 

month. In a proceeding to recover money owed under this subsection,


the person may recover court costs and attorney fees incurred in

 

seeking payment of the money owed.

 

     (7) If after a hearing conducted under rules promulgated under

 

this subsection the department determines that a physician,

 

hospital, clinic, or other person or institution that renders a

 

treatment, product, service, or accommodation to an injured person

 

for accidental bodily injury covered by personal protection

 

insurance, or a person or institution that provides rehabilitative

 

occupational training to the injured person following the injury,

 

has engaged in a pattern or practice of conduct in violation of

 

this section, the department may prohibit the physician, hospital,

 

clinic, or other person or institution from charging and receiving

 

a payment for any treatment, training, product, service, or

 

accommodation under this chapter for a period of time and also may

 

order a refund of amounts received in violation of this section.

 

The department shall promulgate rules to implement this section

 

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

 

24.201 to 24.328.

 

     Sec. 3157a. (1) By rendering any treatment, products,

 

services, or accommodations to 1 or more injured persons for an

 

accidental bodily injury covered by personal protection insurance

 

under this chapter after the effective date of the amendatory act

 

that added this section, a physician, hospital, clinic, or other

 

person is considered to have agreed to do both of the following:

 

     (a) Submit necessary records and other information concerning

 

treatment, products, services, or accommodations provided for

 

utilization review under this section.


     (b) Comply with any decision of the department under this

 

section.

 

     (2) A physician, hospital, clinic, or other person or

 

institution that knowingly submits false or misleading records or

 

other information to an insurer, the association created under

 

section 3104, or the department under this section is guilty of a

 

misdemeanor punishable by imprisonment for not more than 1 year or

 

a fine of not more than $1,000.00, or both.

 

     (3) The department shall promulgate rules under the

 

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

 

24.328, to do both of the following:

 

     (a) Establish criteria or standards for utilization review

 

that identify utilization of treatment, products, services, or

 

accommodations under this chapter above the usual range of

 

utilization for the treatment, products, services, or

 

accommodations based on medically accepted standards.

 

     (b) Provide procedures related to utilization review,

 

including procedures for all of the following:

 

     (i) Acquiring necessary records, medical bills, and other

 

information concerning the treatment, products, services, or

 

accommodations provided.

 

     (ii) Allowing an insurer to request an explanation for and

 

requiring a physician, hospital, clinic, or other person to explain

 

the necessity or indication for treatment, products, services, or

 

accommodations provided.

 

     (iii) Appealing determinations.

 

     (4) If a physician, hospital, clinic, or other person provides


treatment, products, services, or accommodations under this chapter

 

that are not usually associated with, are longer in duration than,

 

are more frequent than, or extend over a greater number of days

 

than the treatment, products, services, or accommodations usually

 

require for the diagnosis or condition for which the patient is

 

being treated, the insurer or the association created under section

 

3104 may require the physician, hospital, clinic, or other person

 

to explain the necessity or indication for the treatment, products,

 

services, or accommodations in writing under the procedures

 

provided under subsection (3).

 

     (5) If an insurer or the association created under section

 

3104 determines that a physician, hospital, clinic, or other person

 

improperly overutilized or otherwise rendered or ordered

 

inappropriate treatment, products, services, or accommodations, or

 

that the cost of the treatment, products, services, or

 

accommodations was inappropriate under this chapter, the physician,

 

hospital, clinic, or other person may appeal the determination to

 

the department under the procedures provided under subsection (3).

 

     (6) If the department determines that an insurer complies with

 

the criteria or standards for utilization review established under

 

subsection (3), the department shall certify the insurer.

 

     (7) As used in this section, "utilization review" means the

 

initial evaluation by an insurer or the association created under

 

section 3104 of the appropriateness in terms of both the level and

 

the quality of treatment, products, services, or accommodations

 

provided under this chapter based on medically accepted standards.

 

     Sec. 3163. (1) 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.

 

     (2) A nonadmitted An insurer that is not authorized to

 

transact automobile insurance in this state 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 an 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, unless the


coverage limits under section 3109a(2)(a) apply. If the coverage

 

limits under section 3109a(2)(a) apply, the insurer is only liable

 

for the amount of ultimate loss sustained up to the coverage limits

 

under section 3109a(2)(a). 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. 3180. (1) By June 30, 2018, an insurer that offers

 

automobile insurance in this state shall file premium rates for

 

personal protection insurance coverage that is subject to the

 

coverage limits under section 3109a(2)(a) or (b) under an

 

automobile insurance policy effective after June 30, 2018 and

 

before July 1, 2019. The premium rates filed, and any subsequent

 

premium rates filed by the insurer for personal protection

 

insurance coverage that is subject to the coverage limits under

 

section 3109a(2)(a) or (b) under an automobile insurance policy

 

effective before July 1, 2023, must reflect savings expected from

 

the provisions of the amendatory act that added this section that

 

affect automobile insurance policies that are subject to the

 

personal protection insurance coverage limits under section

 

3109a(2)(a) or (b), consistent with the requirements of sections

 

2109 to 2111a.

 

     (2) If premium rates filed by an insurer under subsection (1)

 

for personal protection insurance coverage that is subject to the

 

coverage limits under section 3109a(2)(a) do not result in an

 

average 40% reduction per vehicle from the premium rates for


personal protection insurance coverage that were in effect for the

 

insurer on October 1, 2017, the insurer shall include with the

 

filing both of the following:

 

     (a) Premium rates for personal protection insurance coverage

 

that is subject to the coverage limits under section 3109a(2)(a) as

 

near as practicable to that reduction recognizing the

 

justifications described in this subsection.

 

     (b) A detailed explanation of the reasons for the insurer's

 

failure to achieve the required reduction and a demonstration using

 

generally accepted and reasonable actuarial techniques that the

 

required reduction is not justified because of 1 or more of the

 

following:

 

     (i) Expected losses of the insurer.

 

     (ii) Inflation, as shown by the Consumer Price Index

 

calculated and published by the United States Department of Labor,

 

Bureau of Labor Statistics.

 

     (iii) A change in an assessment imposed on an insurer under

 

section 3104 or 3330.

 

     (3) The director shall review a filing submitted by an insurer

 

under subsection (1) for compliance with subsections (1) and (2).

 

The director shall disapprove a filing if after review the director

 

determines both of the following:

 

     (a) That the filing does not result in the premium rate

 

reduction required by subsections (1) and (2).

 

     (b) That the failure to achieve the reduction is not justified

 

using generally accepted and reasonable actuarial techniques

 

because of 1 or more of the factors listed in subsection (2)(b).


     (4) If the director disapproves a filing under subsection (3),

 

the director shall do both of the following:

 

     (a) Determine what rate reduction the insurer could achieve

 

that is as near as practicable to an average 40% reduction per

 

vehicle recognizing the factors listed in subsection (2)(b).

 

     (b) Provide the insurer with a written explanation of the

 

reasons for the disapproval and the director's determination under

 

subdivision (a).

 

     (5) If the director disapproves a filing under subsection (3),

 

the insurer shall submit a revised filing to the director within 15

 

days of the disapproval that complies with the director's

 

determination under subsection (4)(a). The filing is subject to

 

review in the same manner as an original filing under subsection

 

(3).

 

     (6) A premium rate filing under this section that is not

 

disapproved by the director within 30 days of its submission is

 

considered approved. However, the director may extend the time

 

under this subsection by an additional 30 days by giving the

 

insurer written notice before the initial 30-day period expires of

 

the extended time period and the reasons for the extension.

 

     (7) After June 30, 2018 and before July 1, 2023, an insurer

 

shall not issue or renew an automobile insurance policy in this

 

state unless the premium rates filed by the insurer for personal

 

protection insurance coverage subject to the coverage limits under

 

section 3109a(2)(a) or (b) are approved under this section.

 

     (8) For purposes of calculating a personal protection

 

insurance premium or premium rate under this section, the premium


includes the catastrophic claims assessment imposed under section

 

3104.

 

     Sec. 3301. (1) Every insurer authorized to write automobile

 

insurance in this state shall participate in an organization for

 

the purpose of doing all of the following:

 

     (a) Providing the guarantee that automobile insurance coverage

 

will be available to any person who is unable to procure that

 

insurance through ordinary methods.

 

     (b) Preserving to the public the benefits of price competition

 

by encouraging maximum use of the normal private insurance system.

 

     (c) Providing funding for the Michigan automobile insurance

 

fraud authority created under section 6302.

 

     (2) The organization created under this chapter shall be

 

called is the "Michigan automobile insurance placement facility".

 

     Sec. 3330. (1) The board of governors has the power to direct

 

the operation of the facility, including, at a minimum, the power

 

to do all of the following:

 

     (a) To sue and be sued in the name of the facility. A judgment

 

against the facility shall does not create any liabilities in the

 

individual participating members of the facility.

 

     (b) To delegate ministerial duties, to hire a manager, to hire

 

legal counsel, and to contract for goods and services from others.

 

     (c) To assess participating members on the basis of

 

participation ratios pursuant to section 3303 to cover anticipated

 

costs of operation and administration of the facility, to provide

 

for equitable servicing fees, and to share losses, profits, and

 

expenses pursuant to the plan of operation.


     (d) To impose limitations on cancellation or nonrenewal by

 

participating members of facility-placed business, in addition to

 

the limitations imposed by chapters 21 and 32.

 

     (e) To provide for a limited number of participating members

 

to receive equitable distribution of applicants; or to provide for

 

a limited number of participating members to service applicants in

 

a plan of sharing of losses in accordance with section 3320(1)(c)

 

and the plan of operation.

 

     (f) To provide for standards of performance of service for the

 

participating members designated under subdivision (e).

 

     (g) To adopt a plan of operation and any amendments to the

 

plan, consistent with this chapter, necessary to assure the fair,

 

reasonable, equitable, and nondiscriminatory manner of

 

administering the facility, including compliance with chapter 21,

 

and to provide for any other matters necessary or advisable to

 

implement this chapter, including matters necessary to comply with

 

the requirements of chapter 21.

 

     (h) To assess self-insurers and insurers consistent with

 

chapter 31 and the assigned claims plan approved under section

 

3171.

 

     (2) The board of governors shall institute or cause to be

 

instituted by the facility or on its behalf an automatic data

 

processing system for recording and compiling data relative that

 

relates to individuals insured through the facility. An automatic

 

data processing system established under this subsection shall, to

 

the greatest extent possible, be made compatible with the automatic

 

data processing system maintained by the secretary of state, to


provide for the identification and review of individuals insured

 

through the facility.

 

     (3) The board of governors shall assess and collect from

 

participating members and self-insurers money based on

 

participation ratios to cover anticipated costs of operation and

 

administration of the Michigan automobile insurance fraud authority

 

created under section 6302. The amount and duration of the

 

assessment must be approved by at least 5 of the 7 governors

 

elected as provided in the facility's plan of operation.

 

     (4) Before January 2, 2018, the board of governors shall amend

 

the plan of operation to establish appropriate procedures necessary

 

to make assessments for and to carry out the administrative duties

 

and functions of the Michigan automobile insurance fraud authority

 

created under section 6302.

 

     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. 4503. A fraudulent insurance act includes, but is not

 

limited to, acts or omissions committed by any person who

 

knowingly, and with an intent to injure, defraud, or deceive:

 

     (a) Presents, causes to be presented, assists or abets another

 

in presenting, solicits or conspires with another to present, or

 

prepares, with knowledge or belief that it will be presented to or

 

by an insurer or any agent of an insurer, or any an agent of an

 

insurer, reinsurer, or broker, any oral or written statement

 

knowing that the statement contains any false information

 

concerning any a fact that is material to an any of the following:

 

     (i) An application for the issuance of an insurance policy.

 

     (b) Prepares or assists, abets, solicits, or conspires with

 

another to prepare or make an oral or written statement that is


intended to be presented to or by any insurer in connection with,

 

or in support of, any application for the issuance of an insurance

 

policy, knowing that the statement contains any false information

 

concerning any fact or thing material to the application.

 

     (ii) The rating of an insurance policy or reinsurance

 

contract.

 

     (iii) The premiums paid on an insurance policy or reinsurance

 

contract.

 

     (iv) Payments made in accordance with the terms of an

 

insurance policy or reinsurance contract.

 

     (v) A document filed with the director or the chief insurance

 

regulatory official of another jurisdiction.

 

     (vi) The financial condition of an insurer or reinsurer.

 

     (vii) The formation, acquisition, merger, reconsolidation,

 

dissolution, or withdrawal from 1 or more lines of insurance or

 

reinsurance in all or part of this state by an insurer or

 

reinsurer.

 

     (vii) The issuance of written evidence of insurance.

 

     (ix) The reinstatement of an insurance policy.

 

     (b) (c) Presents, or causes to be presented, assists or abets

 

another in presenting, solicits or conspires with another to

 

present, or prepares, with knowledge or belief that it will be

 

presented to or by any an insurer, any oral or written statement

 

including computer-generated information as part of, or in support

 

of, a claim for payment or other benefit pursuant to an insurance

 

policy or reinsurance contract, knowing that the statement contains

 

false information concerning any fact or thing material to the


claim for payment or other benefit.

 

     (d) Assists, abets, solicits, or conspires with another to

 

prepare or make any oral or written statement including computer-

 

generated documents that is intended to be presented to or by any

 

insurer in connection with, or in support of, any claim for payment

 

or other benefit pursuant to an insurance policy, knowing that the

 

statement contains any false information concerning any fact or

 

thing material to the claim.

 

     (c) (e) Solicits or accepts new or renewal insurance risks by

 

or for an insolvent insurer, reinsurer, or person engaged in the

 

business of insurance.

 

     (d) (f) Removes, conceals, alters, or destroys or attempts to

 

remove, conceal, alter, or destroy the assets or records of assets,

 

transactions, and affairs, or a material part of the assets or

 

records, from the home office or other place of business of the an

 

insurer. or from the place of safekeeping of the insurer, or who

 

conceals or attempts to conceal the assets or record of assets,

 

transactions, and affairs, or a material part of the assets or

 

records, from the commissioner.

 

     (e) (g) Diverts, attempts to divert, or conspires to divert

 

funds money of an insurer or of other persons in connection with

 

any of the following:

 

     (i) The transaction of insurance or reinsurance.

 

     (ii) The conduct of business activities by an insurer.

 

     (iii) The formation, acquisition, or dissolution of an

 

insurer.

 

     (f) (h) Employs, uses, or acts as a runner, capper, or steerer


with the intent to falsely or fraudulently obtain benefits under a

 

contract of insurance or to falsely or fraudulently assert a claim

 

against an insured or an insurer for providing services to the

 

client, patient, or customer.

 

     (g) (i) Knowingly and willfully assists, conspires with, or

 

urges any person to fraudulently violate this act, or any person

 

who due to because of that assistance, conspiracy, or urging

 

knowingly and willfully benefits from the proceeds derived from the

 

fraud.

 

     (h) Transacts the business of insurance in violation of laws

 

requiring a license, certificate of authority, or legal authority

 

for the transaction of the business of insurance.

 

     (i) Attempts to commit, aids in or abets the commission of, or

 

conspires to commit the acts or omissions specified in this

 

section.

 

     Sec. 4505. (1) The director may investigate suspected

 

fraudulent insurance acts and persons engaged in suspected

 

fraudulent insurance acts.

 

     (2) The department of attorney general shall provide the

 

department with technical assistance relating to this chapter.

 

     (3) The director may allocate resources of the department for

 

the purpose of prosecuting alleged fraudulent insurance acts.

 

     (4) An insurer or an agent authorized by the insurer to act on

 

its behalf who has knowledge or a reasonable belief that a

 

fraudulent insurance act is being, will be, or has been committed

 

shall provide to the director the information relating to the

 

fraudulent insurance act required by, and in a manner prescribed


by, the director.

 

     (5) Any person other than an insurer or agent of an insurer

 

who has knowledge or a reasonable belief that a fraudulent

 

insurance act is being, will be, or has been committed may provide

 

the director with information relating to the fraudulent insurance

 

act in the form and manner prescribed by the director.

 

     (6) This section does not preempt the authority or relieve the

 

duty of other authorized governmental officers or entities to

 

investigate, examine, and prosecute suspected violations of law.

 

     (7) If an insurer or an officer, employee, or authorized agent

 

of an insurer provides the department with information in good

 

faith under this section, the insurer, officer, employee, or agent

 

is immune from civil or criminal liability for providing the

 

information.

 

CHAPTER 63

 

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) "Board" means the board of directors of the authority.

 

     (d) "Car years" means net direct private passenger and

 

commercial nonfleet vehicle years of insurance providing the

 

security required by section 3101(1) or 3103(1) written in this


state for the second previous calendar year as reported to the

 

statistical agent of each insurer.

 

     (e) "Facility" means the Michigan automobile insurance

 

placement facility created under chapter 33.

 

     Sec. 6302. (1) The Michigan automobile insurance fraud

 

authority is created within the facility. The facility shall

 

provide staff for the authority and shall carry out the

 

administrative duties and functions as directed by the board.

 

     (2) The authority is not a state agency, state authority, or

 

political subdivision of this state. The money of the authority is

 

not state money. A record of the authority is exempt from

 

disclosure under section 13 of the freedom of information act, 1976

 

PA 442, MCL 15.243.

 

     (3) The authority shall do all 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 and theft.

 

     (b) Provide financial support to state or local prosecutorial

 

agencies for programs designed to reduce the incidence of

 

automobile insurance fraud and theft.

 

     (c) Approve or disapprove programs for subdivision (a) or (b),

 

or both.

 

     (4) 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, including, but not limited to,

 

financial support for an active fraud prevention program within the


city in this state with the largest population and joint fraud

 

prevention task forces that include local, state, and federal law

 

enforcement and prosecutorial officials and agencies.

 

     (5) The purposes, powers, and duties of the authority are

 

vested in and shall be exercised by a board of directors. The board

 

of directors shall consist of 15 members as follows:

 

     (a) Eight members who represent automobile insurers in this

 

state, subject to the following:

 

     (i) At least 2 members must represent insurer groups with

 

350,000 or more car years.

 

     (ii) At least 2 members must represent insurer groups with

 

fewer than 350,000 but 100,000 or more car years.

 

     (iii) At least 1 member must represent insurer groups with

 

fewer than 100,000 car years.

 

     (b) The director or his or her designee from within the

 

department.

 

     (c) The director of the department of state police or his or

 

her designee from within the department of state police.

 

     (d) Two members who represent law enforcement agencies in this

 

state other than the department of state police.

 

     (e) One member who represents prosecuting attorneys in this

 

state.

 

     (f) A resident of the city in this state with the largest

 

population, determined on the basis of the latest federal decennial

 

census before the member is appointed.

 

     (g) One member of the general public.

 

     (6) Automobile insurers that are authorized to do business in


this state shall elect the members of the board representing

 

insurers from a list of nominees proposed by the board of governors

 

of the facility. In preparing the list of nominees for the members,

 

the board of governors of the facility shall solicit nominations

 

from the automobile insurers that are authorized to do business in

 

this state.

 

     (7) The governor shall appoint the members of the board that

 

represents law enforcement agencies other than the department of

 

state police. In appointing the members, the governor shall solicit

 

input from various law enforcement associations in this state.

 

     (8) The governor shall appoint the member of the board that

 

represents prosecuting attorneys. In appointing the member, the

 

governor shall solicit input from the Prosecuting Attorneys

 

Association of Michigan.

 

     (9) The governor shall appoint the member under subsection

 

(5)(f) from a list of 3 or more nominees submitted to the governor

 

by the mayor of the identified city.

 

     (10) The governor shall appoint the member of the general

 

public. The governor shall appoint an individual who is a resident

 

of this state and is not employed by or under contract with a state

 

or local unit of government or an insurer.

 

     (11) Except as otherwise provided in this subsection, a member

 

of the board shall serve for a term of 4 years or until his or her

 

successor is elected, designated, or appointed, whichever occurs

 

later. Of the members first elected or appointed under this

 

section, 2 members representing insurers and 1 member representing

 

law enforcement agencies shall serve for a term of 2 years, 3


members representing insurers, the member representing prosecuting

 

attorneys, and the member of the general public shall serve for a

 

term of 3 years, and 3 members representing insurers, 1 member

 

representing law enforcement agencies, and the member appointed

 

under subsection (5)(e) shall serve for a term of 4 years.

 

     Sec. 6303. (1) A member of the board shall serve without

 

compensation, except that the board shall reimburse a member in a

 

reasonable amount for necessary travel and expenses.

 

     (2) The board shall select a chairperson from among its

 

members. A majority of the members of the board constitute a quorum

 

for the transaction of business at a meeting or the exercise of a

 

power or function of the authority, notwithstanding the existence

 

of 1 or more vacancies. Notwithstanding any other provision of law,

 

action may be taken by the authority at a meeting on a vote of the

 

majority of its members present in person or through the use of

 

amplified telephonic equipment, if authorized by the bylaws or plan

 

of operation of the board. The authority shall meet at the call of

 

the chair or as may be provided in the bylaws of the authority.

 

Meetings of the authority may be held anywhere in this state.

 

     (3) The board shall adopt a plan of operation by a majority

 

vote of the board. Vacancies on the board shall be filled in

 

accordance with the plan of operation.

 

     (4) The board shall conduct its business at meetings that are

 

held in this state, open to the public, and held in a place that is

 

available to the general public. However, the board may establish

 

reasonable rules to minimize disruption of a meeting of the board.

 

At least 10 days but not more than 60 days before a meeting, the


board shall provide public notice of the meeting at the board's

 

principal office and on a publicly accessible internet website. The

 

board shall include in the public notice of its meeting the address

 

where minutes of the board may be inspected by the public. The

 

board may meet in a closed session for any of the following

 

purposes:

 

     (a) To consider the hiring, dismissal, suspension,

 

disciplining, or evaluation of officers or employees of the

 

authority.

 

     (b) To consult with its attorney.

 

     (c) To comply with state or federal law, rules, or regulations

 

regarding privacy or confidentiality.

 

     (5) The board shall display information concerning the

 

authority's operations and activities, including, but not limited

 

to, the annual financial report required under section 6308, on a

 

publicly accessible internet website.

 

     (6) The board shall keep minutes of each board meeting. The

 

board shall make the minutes open to public inspection and

 

available at the address designated on the public notice of its

 

meetings. The board shall make copies of the minutes available to

 

the public at the reasonable estimated cost for printing and

 

copying. The board shall include all of the following in the

 

minutes:

 

     (a) The date, time, and place of the meeting.

 

     (b) The names of board members who are present and board

 

members who are absent.

 

     (c) Board decisions made during any portion of the meeting


that was open to the public.

 

     (d) All roll call votes taken at the meeting.

 

     Sec. 6304. The board 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 in the name of the authority.

 

     (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) Indemnify and procure insurance indemnifying any member of

 

the board for personal loss or accountability resulting from the

 

member's action or inaction as a member of the board.

 

     (h) 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. 6305. (1) The board may examine in person, by writing,

 

and, if appropriate, under oath all persons considered by the board


to have material information regarding automobile insurance fraud.

 

The board may compel the attendance and testimony of witnesses and

 

the production of any books, accounts, papers, records, documents,

 

and files relating to automobile insurance fraud, and may authorize

 

subpoenas, the administration of oaths and affirmations, and the

 

examination of witnesses, and may receive evidence for this

 

purpose. The board may request the Ingham County circuit court to

 

issue an order requiring compliance with an order or subpoena of

 

the board under this subsection.

 

     (2) This chapter does not preempt the authority or relieve the

 

duty of other authorized governmental officers or entities to

 

investigate, examine, and prosecute suspected violations of law.

 

     Sec. 6306. (1) An insurer or self-insurer engaged in writing

 

insurance coverages that provide the security required by section

 

3101(1) and 3103(1) in this state shall pay to the facility any

 

assessment imposed under section 3330(3) for deposit into the

 

account of the authority to be used by the authority to carry out

 

its duties under this chapter.

 

     (2) The facility shall segregate all money received under

 

subsection (1), and all other money received by the authority for

 

the purpose, from other money of the facility, if applicable. The

 

facility shall only expend the money received under subsection (1)

 

as directed by the board.

 

     Sec. 6307. (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 board.

 

     (2) The department of state police and local law enforcement

 

agencies shall cooperate with the authority and shall provide

 

available motor vehicle fraud and theft statistics to the authority

 

on request.

 

     (3) The board shall develop performance metrics that are

 

consistent, controllable, measurable, and attainable. The board

 

shall use the metrics each year to evaluate new applications

 

submitted for funding consideration and to renew funding for

 

existing programs.

 

     Sec. 6308. (1) Beginning January 1, 2019, the authority shall

 

prepare and publish an annual financial report, and beginning July

 

1, 2019, 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. The

 

members of the board, 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, automobile


insurance fraud recidivism, wrongful or fraudulent solicitation of

 

clients by attorneys in matters relating to automobile insurance,

 

and fraud related to medical services not reasonably necessary or

 

otherwise excessive. 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 to the director.