HomeMy WebLinkAboutRES 045 Draft 01 1994-1996COUNTY OF HAWAII. -STATE OF HAWAII
RESOLUTION N0. 45 95
WHEREAS, the State of Hawaii has a population of approximately 1.2 million people; and
WHEREAS, throughout the United States there are 29 cities with greater populations, and 33
"greater metropolitan azeas", which aze smaller than counties, that have greater populations than
the State of Hawaii; and
WHEREAS, there are ] 0 states that have populations that aze less than the State of Hawaii; and
WHEREAS, the following chart shows the State of Hawaii and each of these 10 states, along
with the number of property and casualty insurance companies licensed to do business in that
respective state, and where that state ranks as to the average expenditure per insured vehicle, with
one being the most expensive and fifty being the least expensive:
tae No. of P & C Carriers Rank
Hawaii 311 1
Rhode Island 538 5
Delaware 780 8
Alaska 540 11
New Hampshire 441 19
Vermont 434 35
Idaho 707 43
Montana 707 44
Wyoming 700 47
South Dakota 662 49
North Dakota 715 50; and
WHEREAS, this chart cleazly shows, with the exception of Delaware, that those states with the
greatest number of insurance companies licensed in that state aze those states with the lowest
insurance premiums; and
WHEREAS, the State of Hawaii has the least number of insurance companies licensed here and
has the highest insurance premiums; and
WHEREAS, the financial requirements that an insurance company has to meet in order to be
licensed in Hawaii, and the regulations that they must operate under, are more severe than other
states, discouraging insurance companies from doing business here; and
WHEREAS, a majority of our citizens aze unable to afford auto insurance and that many
homeowners aze unable to obtain, let alone afford, homeowners insurance; and
WHEREAS, this "insurance crisis" has become a crushing burden on the citizens and the
businesses of Hawaii; and
WHEREAS, competition is the REAL answer to our overall insurance problems.
NOW, THEREFORE, BE IT RESOLVED BY THE COUNTY COUNCIL OF THE COUNTY
OF HAWAII that the Governor, Legislature, and Insurance Commissioner of the State of Hawaii
remove all unfriendly regulatory and financial requirements from its insurance code, and that any
insurance company with an AM Best rating of B or better, that is licensed in any of the other 49
states, be allowed to do business in the State of Hawaii.
BE IF FURTHER RESOLVED that the Governor, Legislature, and Insurance Commissioner of
the State of Hawaii produce an insurance company "rating" guide book (as Dunn & Bradstreet)
and that if an insurer fails to pay a legitimate claim, that the State of Hawaii shall pursue remedy
in behalf of the Hawaii resident, and should the company not settle in a fair manner that it be
prohibited from further business in the state.
BE IT FURTHER RESOLVED that, at the very least, the Legislature of the State of Hawaii
debate and consider adoption of HB #530 and HB #526, opening the Hawaiian mazket to many
more insurance companies, thus giving Hawaii the competitive mazket place that will benefit its
consumers.
BE IT FURTHER RESOLVED that the Governor, Legislature, and Insurance Commissioner of
the State of Hawaii make its highest priority the enforcement of workers' compensation fraud.
BE IT FURTHER RESOLVED that the Legislature of the State of Hawaii debate and consider
adoption of HB #524 which repeals Hawaii's current no-fault law, and debate and consider
adoption of the no fault insurance law of the State of Michigan (the law and summary of same is
attached).
BE IT FURTHER RESOLVED that the Clerk of the County of Hawaii transmit copies of this
resolution to the Governor of the State of Hawaii, all of the Hawaii Island Legislators, and the
Insurance Commissioner.
Dated at Hilo, Hawaii, this 15th day of Februarv , 1995.
COU
Coi
I hereby certify that the fa
vote indicated to the right
the County of Hawaii on
ATTEST:
6'~i~~ G
C UNTY CLE CHAIRMAN
R OLL CAL L VOTE
NTY COUNCIL
of Hawaii
t qy~ NOES ABS EX
ar
y
Hawaii
Silo
, Arakaki X
Bonk-Abramson X
the
RESOLUTION was b
oin Childs X
y
reg
g
COUNCIL
f
h ~ Luna X
o
e
hereof adopted by t ~m"lge X
February 15, 1995
Osorio X
Rath X
Ray X
Smith X
7 0 2 0
\~'^-~ Reference C-196
PRESIDING OFFICER RESOLUTION NO. 4~ g S
THE INSURANCE CODE OF 1956
(EXCERPTS)
NO-FAULT AUTO INSURANCE
CHAPTER 31 OF
Act No. 218 of the Public Acts of 1956
M. C. L. Sections 500.3101 to 500.3179
(as last amended by Act No. 28 of 1994)
Updated
9/15/94
(ATTACHt1E4dT TO RES. 45-95)
TABLE OF CONTENDS
500.3101 Security for payment of benefits required; period
security required to be in effect; deletion of cover-
ages; definitions; policy of insurance or other method
of providing security; filing proof of security;
"insurer" defined.
500.3101 Security for payment of benefits required; period
security required to be in effect; deletion of cover-
ages; definitions; policy of insurance or other method
of providing security; filing proof of security;
"insurer" defined.
500.3101a Providing certificates of insurance to policyholder;
filing copy with secretary of state; prohibited acts;
misdemeanor; penalty.
500.3101a Providing certificates of insurance to policyholder;
filing copy with secretary of state; prohibited acts;
misdemeanor; penalty.
500.3102 Nonresident owner or registrant of motor vehicle or
motorcycle to maintain security for payment of bene-
fits; operation of motor vehicle or motorcycle by
owner, registrant, or other person without security;
penalty; failure to produce evidence of security;
rebuttable presumption.
500.3103 Owner or registrant of motorcycle; security required;
offering security for payment of first-party medical
benefits; rates, deductibles, and provisions.
500.3103a Recovery of attorney fees.
1500.3104 Catastrophic claims association; creation; membership
as condition of authority to transact insurance; laws
to which association subject; indemnification for
ultimate loss; withdrawal from association; effect of
termination by withdrawal; unsatisfied net liability
of insolvent member; liability upon merger, consolida-
tion, or reinsurance of business; powers and duties of
association; creation and responsibility of board of
directors; provisions of plan of operation; organiza-
tional meeting of board; appointment, qualifications,
and terms of directors; voting; rules; election of
chairperson; vacancy; meetings; quorum; annual report;
plan of operation required; reporting, loss reserve,
and investment requirements; recognition of premiums
in rate-making procedures; examining affairs of
association; effective date; liability for losses.
500.3104 Excess PIP association; creation; membership as
condition of authority to transact insurance; laws to
which association subject; indemnification for ulti-
mate loss; amounts; withdrawal from association;
effect of termination by withdrawal; unsatisfied net
liability of insolvent member; liability upon merger,
consolidation, or reinsurance of business; powers and
duties of association; creation and responsibility of
board of directors; provisions of plan of operation;
appointment, qualifications, and terms of directors;
voting; rules; election of chairperson; vacancy; meet-
ings; quorum; annual report; plan of operation
required; reporting, loss reserve, and investment
requirements; recognition of premiums in rate-making
procedures; examining affairs of association; liabil-
ity for losses; assessments to recoup deficiencies in
MCCA account; applicability of change in amounts in
subsection (2); separate accounts; prohibition;
definitions.
~500.3104a Personal injury protection task force; creation;
appointment; plan to reduce costs for automobile
related injuries; report.
500.3104b Clinical care management; use; duties of automobile
insurer and clinical care manager; definitions.
°"500.3105 Insurer liable for personal protection benefits with-
out regard to fault; "bodily injury" and "accidental
bodily injury" defined.
500.3106 Accidental bodily injury arising out of ownership,
operation, maintenance, or use of parked vehicle as
motor vehicle; conditions.
500.3107 Expenses and work loss for which personal protection
benefits payable.
500.3107 Expenses and work lose for which personal protection
benefits payable; requirements applicable to subsec-
tion (t); waiver; requirements applicable to medically
appropriate products, services, and accommodations;
reimbursement to provider; duplicate benefits; failure
to pay; "health care provider" defined.
500.3107a Basis of work loss for certain injured persons.
500.3108 Survivor's loss; benefits.
500.3109 Subtraction of other benefits from personal protection
benefits; "injured person" defined; deductible
provision.
500.3109a Offering deductibles and exclusions reasonably related
to other health and accident coverage; rates;
approval; applicability.
500.3109a Offering deductibles and exclusions reasonably related
to other health and accident coverage; rates; approv-
al; applicability; health and accident coverage as
secondary to personal protection insurance benefits;
other coverage not as health and accident coverage.
500.3110 Dependents of deceased person; termination of depen-
dency; accrual of personal protection benefits.
500.3111 Payment of personal protection benefits for accident
occurring out of state.
500.3112 Persons to whom personal protection benefits payable;
discharge of insurer's liability.
500.3113 Persons not entitled to personal protection benefits.
500.3114 Persons entitled to personal protection insurance ben-
efits or personal injury benefits; recoupment barred;
order of priority for claim of motor vehicle occupant
or motorcycle operator or passenger; 2 or more insur-
ers in same order of priority; partial recoupment.
500.3115 Priorities as to claims of persons not occupants of
vehicle; partial recoupment; limitation on benefits.
500.3115 Priorities as to claims of persons not occupants of
vehicle; partial recoupment; limitation on benefits;
determining limit of insurance coverage available.
500.3116 Value of claim in tort; subtraction from or reimburse-
ment for benefits.
500.3116 Value of claim in tort; subtraction from or reimburse-
ment for benefits.
500.3118 Denial of claim to benefits; appeal; informal
managerial-level conference procedures; conciliation
conference; rules relating to conciliation conference;
attorney not required; effective date of section.
X500.3121 Liability for accidental damage to tangible property.
500.3123 Exclusions from property protection insurance
benefits.
500.3125 Priorities in claiming property protection benefits.
500.3127 Distribution of loss, reimbursement, and
indemnification among property protection insurers.
500.3131 Residual liability insurance; coverage.
500.3135 Tort liability for noneconomic loss; abolition of tort
liability; exceptions; action for damages; commence-
ment of action; removal; costs; decision as res judi-
cata; effective date of subsections (2)(d), (3), (4),
and (5).
500.3135 Tort liability of noneconomic loss; provisions appli-
cable to filing cause of action; abolition of tort
liability; exceptions; action for damages; commence-
ment of action; removal; costs; decision as res judi-
cata; powers of court relating to entry of judgment.
500.3141 Notice of accident.
500.3142 Personal protection benefits payable as loss accrues;
overdue benefits.
500.3142 Personal protection benefits payable as loss accrues;
overdue benefits; interest.
500.3143 Assignment of right to future benefits void.
500.3145 Limitation of actions for recovery of personal or
property protection benefits; notice of injury.
500.3145 Actions for recovery of personal or property protec-
tion benefits; limitation; notice of injury; commence-
ment of action.
500.3146 Limitation of action by insurer for recovery or
indemnity.
500.3148 Attorney's fee.
500.3151 Submission to mental or physical examination.
500.3152 Report of mental or physical examination.
500.3153 Court orders as to noncompliance with $$ 500.3151 and
500.3152.
500.3157 Charges for products, services, and accommodations
where treatment rendered.
500.3157 Charges for products, services, and accommodations
where treatment rendered; limitation; rules establish-
ing schedules of fees; utilization review system;
annual report; prohibition; reimbursement as payment
in full; variances not precluded.
500.3158 Statement of earnings; report and records from medical
institution.
500.3159 Discovery.
500.3163 Certification by admitted and nonadmitted insurers as
to protection of out-of-state resident; tights and
immunities of insurer and insureds.
500.3171 Assigned claims facility and plan; organization and
maintenance; participation; costs; rules.
500.3172 Conditions to obtaining personal protection insurance
benefits through assigned claims plan; collection of
unpaid benefits; reimbursement from defaulting insur-
ers; reduction of benefits; applicability of subsec-
tion (2); definitions; effect of dispute between
insurers.
500.3172 Conditions to obtaining personal protection insurance
benefits through assigned claims plan; collection of
unpaid benefits; reimbursement from defaulting insur-
ers; reduction of benefits; applicability of subsec-
tion (3); definitions; effect of dispute between
insurers; effect of unidentified or inadequate bene-
fits; benefits unavailable due to insolvent insurer.
500.3172a Michigan protection insurance benefits; conditions
entitling person to claim; pciority of obligation.
500.3173 Certain persons disqualified from receiving benefits
under assigned claims plans.
500.3173a Eligibility for benefits; initial determination;
denial; notice.
500.3174 Notice of claim through assigned claims plan; assign-
ment of claim; notice to claimant; commencement of
action by claimant.
500.3175 Rules for assignment of claims; duties of insurer to
whom claims assigned; compromises and settlements;
rules; limitation on action to enforce rights; inter-
est on delinquent payments; installment payments.
500.3176 Taking costs into account in making and regulating
rates.
500.3177 Recovery by insurer of benefits and costs from owner
or registrant of uninsured motor vehicle; written
agreement to pay judgment in installments; notice.
500.3179 Act applicable October 1, 1973.
THE INSDRANCE CODE OF 1956
Act 218 of 1956 (EXCEFtP'15)
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 othec persons, firms, corporations, associations, risk reten-
tion 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 pro-
vide for the imposition of a tax on risk retention groups and pur-
chasing groups; to provide for the imposition of a tax on the busi-
ness of surplus line agents; to provide for the imposition of regula-
tory fees on certain insurers; to modify tort liability arising out
of certain accidents; to provide for liauted 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 cer-
tain claims against uninsured oz 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 mal-
practice insurance fund; to provide for the departmental supervision
and regulation of the insurance and surety business within this
state; to provide for the conservation, rehabilitation, or liquida-
tion 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 policy-
holders and claimants in the event of insurer insolvencies; to pre-
scribe educational requirements for insurance agents and solicitors;
to provide for the regulation of multiple employer welfare arrange-
ments; to create an automobile theft prevention authority to reduce
the number of automobile thefts in this state; to prescribe the
powers and duties of the automobile theft prevention authority; to
provide certain powers and duties upon certain officials, depart-
ments, and authorities of this state; to repeal certain acts and
parts of acts; to repeal certain acts and parts of acts on specific
dates; to repeal certain parts of this act on specific dates; and to
provide penalties for the violation of this act.
History: 1956, Act 216, Eff. Jan. I, 1957;--Am. 1972, Act 294,
Eff. Mar. 30, 1973;--Am. 1977, Act 42, Lad. Eff. June 28, 1977; -Am.
1979, Act 145, Imd. Eff. Nov. 13, 1979;--Am. 1980, Act 41, Imd. Eff.
Mar. 17, 1980;--Am. 1982, Act 194, Imd. Eff. June 28, 1982;--Am.
1986, Act 10, Imd. Eff. Feb. 28, 1986;-Am. 1986, Act 121, Imd. Eff.
May 28, 1986;--Am. 1986, Act 173, Imd. Eff. July 7, 1986;--Am. 1989,
Act 214, Eff. Jan. 1, 1990;--Am. 1991, Act 24, Imd. Eff. May 20,
1991;--Am. 1993, Act 143, Eff. (pending);--Am. 1994, Act 228, Imd.
Eff. June 30, 1999.
The People of the State of Michigan enact:
CHAPTER 31
MOTOR VEHICLE PERSONAL AND PROPERTY PROTECTION
XXOXX 500.3101 THZS SECTION IS AMENDED IF 1993 PA 143 IS
APPROVED BY A MAJORITY OF THE ELECTORS VOTING THEREON AT
THE NOVEMBER 8, 1994 GENERAL ELECTION: See
'mc1.00500.03101.amended XXOXX
500.3101 Security for payment of benefits required; period security
required to be in effect; deletion of coverages; definitions;
policy of insurance oc other method of providing security; filing
proof of security; "insurer" defined.
Sec. 3101. (I) The owner or registrant of a motor vehicle required
to be registered in this state shall maintain security for payment of
benefits under personal protection insurance, property protection
insurance, and residual liability insurance. Security shall only be
required to be in effect during the period the motor vehicle is
driven or moved upon 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 upon 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) "Highway" means that term as defined in section 20 of the
Michigan vehicle code, Act No. 300 of the Public Acts of 1999, being
section 257.20 of the Michigan Compiled Laws.
(c) "Motorc cle" means a vehicle having a saddle or seat for the
use of the rider, designed to travel on not more than 3 wheels in
contact with the ground, which is equipped with a motor that exceeds
50 cubic centimeters piston displacement. The wheels on any attach-
ment to the vehicle shall not be considered as wheels in contact with
the ground. Motorcycle does not include a moped, as defined in sec-
tion 32b of the Michigan vehicle code, Act No. 300 of the Public Acts
of 1949, being section 257.32b of the Michigan Compiled Laws.
(d) "Motorcycle accident" means a loss involving the ownership,
operation, maintenance, or use of a motorcycle as a motorcycle, but
not involving the ownership, operation, maintenance, or use of a
motor vehicle as a motor vehicle.
(e) "Motor vehicle" means a vehicle, including a trailer, operated
or designed for operation upon a public highway by power other than
muscular power which has more than 2 wheels. Motor vehicle does not
include a motorcycle or a moped, as defined in section 32b of Act No.
300 of the Public Acts of 1949, being section 257.32b of the Michigan
Compiled Lawa. Motor vehicle does not include a farm tractor or other
implement of husbandry which is not subject to the registration
requirements of the Michigan vehicle code pursuant to section 216 of
the Michigan vehicle code, Act No. 300 of the Public Acts of 1949,
being section 257.216 of the Michigan Compiled Laws.
(f) "Motor vehicle accident" means a loss involving 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.
(g) "Owner" means any of the following:
(i) A person renting a motor vehicle or having the use thereof,
under a lease or otherwise, for a period that is greater than 30
days.
(ii) A person who holds the legal title to a vehicle, other than a
person engaged in the business of leasing motor vehicles who is the
lessor of a motor vehicle pursuant to a lease providing for the use
of the motor vehicle by the lessee for a period that is greater than
30 days.
(iii) A person who has the immediate right of possession of a
motor vehicle under an installment sale contract.
(h) "Registrant" does not include a person engaged in the business
of leasing motor vehicles who is the lessor of a motor vehicle pursu-
ant to a lease providing for the use of the motor vehicle by the
lessee for a period that is greater than 30 days.
(3) Security may be provided under a policy issued by an insurer
duly authorized to transact business in this state which affords
insurance for the payment of benefits described in subsection (i). A
policy of insurance represented or sold as providing security shall
e deemed to provide insurance for the payment of the benefits.
(4) Security required by subsection (I) 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 upon
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 any person filing the
security as provided in this section.
History: Add. 1972, Act 294, Eff. Mar. 30, 1973;--Am. 1975, Act
329, Eff. Mar. 31, 1976;--Am. 1977, Act 54, Imd. Eff. July 6,
1977;--Am. 1980, Act 445, Imd. Eff. Jan. 15, 1981;--Am. 1984, Act 84,
Imd. Eff. Apr. 19, 1984;--Am. 1987, Act 168, Imd. Eff. Nov. 9,
1987;--Am. 1988, Act 126, Imd. Eff. May 23, 1988.
Constitutionality: Subsection (1~ of this section is unrnnstitu-
tional but subsection (2) does not violate the due process and equal
protection clauses. Shavers v. Attorney General, 402 Mich. 559, 267
N.W.2d 72 (1978).
Cited in other sections: Section 500.3101 et seq. is cited in SS
124.5, 129.9. 257.226, 257.328, 257.801e, 257.907, 257.1603,
257.1913, 400.106, and 474.109.
XXXX 500.3101.amended THIS AMENDED SECTION IS NOT EFFECTIVE
UNLESS APPROVED BY A MAJORITY OF THE ELECTORS VOTING
THEREON AT TBE NOVEMBER 8, 1994 GENERAL ELECTION XXXX
500.3101 Security for payment of benefits required; period severity
required to be in effect; deletion of coverages; definitions;
policy of insurance or other atethod of providing security; filing
proof of security; "insurer• defined.
Sec. 3101. (1 The owner or registrant of a motor vehicle required
to be registered in this state shall maintain secucity Eor payment of
benefits under personal protection insurance in an amount not less
than that required in section 3107(I)(a)(i), property protection
insurance, and residual liability insurance. Security shall only be
required to be in effect during the period the motor vehicle is
driven or moved upon 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 upon 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) "Highway" means that term as defined in section 20 of the
Michigan vehicle code, Act No. 300 of the Public Acts of 1949, being
section 257.20 of the Michigan Compiled Laws.
(c) "Motorcycle" means a vehicle that is required to be registered
for use on a public highway in this state having a saddle or seat for
the use of the rider, designed for operation upon a public highway
and to travel on not mote than 3 wheels in contact with the ground,
and that is equipped with a motor that exceeds 50 cubic centimeters
piston displacement. The wheels on any attachment to the vehicle
shall not be considered as wheels in contact with the ground.
Motorcycle does not include a moped, as defined in section 32b of the
Michigan vehicle code, Act No. 300 of the Public Acts of 1949, being
section 257.32b of the Michigan Compiled Laws, or an ORV as defined
in section I of Act No. 319 of the Public Acts of 1975, being section
257.1601 of the Michigan Compiled Laws.
(d) "Motorcycle accident" means a loss involving the ownership,
operation, maintenance, or use of a motorcycle as a motorcycle, but
not involving the ownership, operation, maintenance, or use of a
motor vehicle as a motor vehicle.
(e) "Motor vehicle" means a vehicle that is required to be r~is-
tere for use on a public highway in this state, including a trai er,
and that is operated or designed for operation upon a public highway
by power other than muscular power which has more than 2 wheels.
Motor vehicle does not include a motorcycle or a moped, as defined in
section 32b of Act No. 300 of the Public Acts of 1949, being section
257.32b of the Michigan Compiled Laws, or an ORV as defined in sec-
tion I of Act No. 319 of the Public Acts of 1975, being section
257.1601 of the Michigan Compiled Laws. Motor vehicle does not
include a farm tractor or other implement of husbandry that is not
subject to the registration requirements of the Michigan vehicle code
pursuant to section 216 of the Michigan vehicle code, Act No. 300 of
the Public Acts of 1949, being section 257.216 of the Michigan
Compiled Laws.
(f) "Motor vehicle accident" means a loss involving the ownership,
operation, maintenance, or use of a motor vehicle as a motor vehicle
regardless of whether the accident also involves the ownership, oper-
ation, maintenance, or use of a motorcycle as a motorcycle.
(g) "Owner" means any of the following:
4
(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 who holds the legal title to a vehicle, other than a
person engaged in the business of leasing motor vehicles who is the
lessor of a motor vehicle pursuant to a lease providing for the use
of the motor vehicle by the lessee for a period that is greater than
30 days.
(iii) A person who has the immediate right of possession of a
motor vehicle under an installment sale contract.
(h) "Ownership, operation, maintenance, or use of a motor vehicle
as a motor vehicle" means that the involvement of the motor vehicle
in the injury was directly related to the transportation function of
the motor vehicle.
(i) "Registrant" does not include a person engaged in the business
of leasing motor vehicles who is the lessor of a motor vehicle pursu-
ant to a lease providing for the use of the motor vehicle by the
lessee for a period that is greater than 30 days.
(3) Security may be provided under a policy issued by an insurer
duly authorized to transact business in this state that affords
insurance foc the payment of benefits dgscribed in subsection (t). A
policy of insurance represented or sold as providing security shall
e deemed to provide insurance for the payment of the benefits.
(4) Security required by subsection (I) 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 upon
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 any person filing the
security as provided in this section.
History: Add. 197:
329, Eff. Mar. 31,
1977;--Am. 1980, ACt
Imd. Eff. Apr. 19,
1987;--Am. 1988, Act
Eff. (pending).
!, Act 294, Eff. Mar. 30, 1973;--Am. 1975, Act
1976;--Am. 1977, Act 54, Imd. Eff. July 6,
945, Imd. Eff. Jan. 15, 1981; -Am. 1984, Act 84,
1984;--Am. 1987, Act 168, Zmd. Eff. Nov. 9,
126, Lod. Eff. May 23, 1988; -Am. 1993, Act 143,
Constitutionality: Subsection (1~ of this section is unconstitu-
tional but subsection (2) does not violate the due process and equal
protection clauses. Shavers v. Attorney General, 402 Mich. 554, 267
N.W.2d 72 (1978).
Cited in other sections: Section 500.3101 et seq is cited in
SS 124.5, 124.9, 257.226, 257.328, 257.801e, 257.907, 257.1603,
257.1913, 900.106, and 474.109.
XXOXX 500.3101a THIS SECTION IS AMENDED IF 1993 PA 143 IS
APPROVED BY A MAJORITY OF TBE ELECTORS VOTING THEREON AT
TBE NOVEMBER 8, 1994 GENERAL ELECTION: See
'mc1.00500.03101a.amended XXOXX
500.3101a Providing certificates of insurance to policyyholder;
filing copy with secretazy of state; prohibited acts; eisdeaeanor;
penalty.
Sec. 3101a. (1) An insurer, in conjunction with the issuance of an
automobile insurance policy, as defined in section 3303, shall pro-
vide 2 certificates of insurance to each policyholder. The insurer
shall mark i of the certificates as the secretary of state's copy,
which copy shall be filed with the secretary of state by the policy-
holder upon application for a vehicle registration. The secretary of
state shall not maintain the certificate of insurance received under
this subsection on file.
(2) A person who supplies false information to the secretary of
state under this section oc who issues or uses an invalid certificate
of insurance 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.
History: Add. 1980, Act 461, Eff. Apr. 1, 1981.
XXXX 500.3101a.amended THIS AMENDED SECTION IS NOT EFFECTIVE
UNLESS APPROVED BY A MAJORITY OF THE ELECTORS VOTING
THEREON AT THE NOVEMBER 8, 1994 GENERAL ELECTION XXXX
500.3101a Providing certificates of insurance to policyholder;
filing copy with secretary of state; prohibited acts; misdemeanor;
penalty.
Sec. 3101a. (I) An insurer in conjunction with the issuance of an
automobile insurance policy as defined in section 3303 shall provide
2 certificates of insurance to each policyholder. Each certificate of
insurance shall list the market assistance pplan's toll-free telephone
number established pursuant to section 2115a. The insurer shall mark
1 of the certificates as the secretary of state's copy, and that copy
or an electronically or electromagnetically transmitted facsimile of
that copy shall be filed with the secretary of state by the policy-
holder upon application for a vehicle registration. The secretary of
state shall not maintain the certificate of insurance received under
this subsection on file.
(2) A person who supplies false information to the secretary of
state under this section or who issues or uses an invalid certificate
of insurance is guilty of a misdemeanor punishable by imprisonment
for not more than I year, or a fine of not more than $1,000.00, or
both.
History: Add. 1980, Act 461, Eff. Apr. I, 1981;--Am. 1993, Act
t43, Eff. (pending).
500.3102 nonresident owner or registrant of motor vehicle or sntor-
cycle to maintain securityp for pay^ent of benefits; operation of
motor vehicle or swtorc cle by owner, registrants or other person
without security; penalty; failure to produce evidence of securi-
ty; rebuttable presuoption.
Sec. 3102. (i) A nonresident owner or registrant of a motor vehi-
cle or motorcycle not registered in this state shall not operate or
permit the motor vehicle or motorcycle to be operated in this state
for an aggregate of more than 30 days in any calendar year unless he
or she continuously maintains security for the payment of benefits
pursuant to this chapter.
(2) An owner or registrant of a motor vehicle or motorcycle with
respect to which security is required, who operates the motor vehicle
or motorcycle or permits it to be o erated upon a public highway in
this state, without having in full force and effect security
6
complying with t tson wholope~atese a motorlvehicle or3motor~cycle upon
misdemeanor. A pe,
a public highway in this state with the knowledge that the owner or
ofgasmisdemeanorn A personsconvictednofualmisdemeanoreunder thisusecy
tion shall be fined not less than $2o~'both r more than $500.00,
imprisoned for not more than I year,
(3) The failure of a person to produce evidence that a motor vehi-
cle or motorcycle has in full force and effect security complying
with this section or section 3101 or 3103p on the date of the issuance
of the citation, creates a rebuttable resumption in a prosecution
under subsection (2) that the motor vehicle n r w th thYslse c ionnor
have in full force and effect security cane Y g
section 3101 or 3103 on the date of the issuance of Ame 1975,1Act
History: Add. 1972, Act 294, Ef9.9-dACt3045~9Imd. Eff. Nov. I3,
329, Eff. Mar. 31, 1976;--Am. 1987, Act
1979;--Am• 1980, Act 446, Imd. Eff. Jan. 15, 1981;--Am. 24, 1990.
187, Eff. Mar. 30, 1988%--Am. 1990, Act 79, Imd. Eff. May
Cited in other sections: Section 500.3102 is cited in S 257.328.
500.3103 Owner or registrant of motorcycle; security required;
offering security for payment of first-party medical benefits;
rates, deductibles, and provisions.
Sec. 3103. (1) An owner or re istrant of a motorcyclmeposshall pro-
vide securitydamalestbodslyrinjuryngorrdeathasuffeied by ea person
for property 9 y
arising out of the ownership,.maintenanceiro~bt8 of sectiont3009(1).
The security shall conform with the requ
(2) Each insurer transacting insurance in this state which affords
coverage for a motorcycle as described in subsection (1) also shall
offer, to an owner or reegistrant of a motorcycYe.i~~ncrementstoE
ayment of arable pin the event thee ownersornregistrant is involved
y5,000.00, p Y medical
in a motorcycle accident. An insurer providing first-party rovi-
benefits may offer, at appropriate premium rates, deductibles, p
sions for the coordination of these benefits, and provisions for the
subtraction of other benefits provided or required to be provided
under theroval of thescommissionerf~These deductibles and3provisions
prior app to benefits pa able to the person named in the
p onl y
policy a t~ey spouse of the insured, and any relative of either domi-
ciled in the same household. 1977, Act
History: Add. 1975, Ac19779~ A~• M980~3ACtt9445,-Eff• Jan. 15,
54, Imd. Eff. July 6, 1986.
1981;--Am. 1986, Act 173, Imd. Eff. July 7,
Constitutionality: The legyislative scheme which al7lows motorcy-
requiring themlto maintaintcwefault securipyeLdoes notnden1ea~'tomobile
drivers equal protection or due process of law. Unde979 1 v. Safeco
Insurance Company, 407 Mich. 175, 284 N.W.2d 463
XXXX SpNLESS3APPROVED BYHASMAJORDITYEOFITHEIELECTORSFVOTING
THEREON AT THE NOVEMBER 8, 1994 GENERAL ELECTION XXXX
7
500.3103a Recovery of attorney fees.
Sec. 3t03a. A person who is successful in a court action against
an insurer for wrongfully denying benefits due under this chapter
shall recover reasonable attorney fees from the insurer. This section
applies to claims filed on and after 120 days after the effective
date of the amendatory act that added this section.
History: Add. 1993, Act 193, Eff. (pending).
XXOXX 500.3104 THIS SECTION IS AMENDED IF 1993 PA 193 IS
APPROVED BY A MAJORITY OF THE ELECTORS VOTING THEREON AT
THE NOVEMBER 8, 1994 GENERAL ELECTION: See
'mc1.00500.03104.amended XXOXX
500.3104 Catastrophic claims association; creation; membership as
condition of authority to transact insurance; laws to which asso-
ciation subject; indemnification for ultimate loss; withdrawal
from association; effect of termination by withdrawal; unsatisfied
net liability of insolvent member; liability upon merger, consoli-
dation, or reinsurance of business; powers aid duties of associa-
tion; creation and responsibility of board of directors; provi-
sions of plan of operation; organizational meeting of board;
appointment, qualifications, and terms of directors; voting;
rules; election of chairperson; vacancy; meetings; quorum; annual
report; plan of operation required; reporting, loss reserve, and
investment requirements; recognition of premiums in rate-making
procedures; examining affairs of association; effective date;
liability for losses.
Sec. 3104. (I) 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 which provide the security required by section
3101(1) within this state, as a condition of its authority to trans-
act insurance in this state, shall be a member of the association and
shall be bound bX the plan of operation of the association. Each
insurer engaged in writing insurance coverages which provide the
security required by section 3103(1) within this state, as a condi-
tion of its authority to transact insurance in this state, shall be
considered a member of the association, but only for purposes of
assessments under subsection (7)(d). Except as expressly provided in
this section, the association shall not be subject to any laws of
this state with respect to insurers, but in al~ other respects the
association shall be sub]'ect to the laws of this state to the extent
that the association would be were it an insurer organized and sub-
sisting under chapter 50.
(2) The association shall provide and each member shall accept
indemnification for IOOi of the amount of ultimate loss sustained
under personal protection insurance coverages in excess of
$250,000.00 in each loss occurrence. As used in this section,
"ultimate loss" means the actual loss amounts which a member is obli-
gated to pay and which are paid or payable by the member, and shall
not include claim expenses. An ultimate loss is incurred by the asso-
ciation on the date which the loss occurs.
(3) An insurer may withdraw from the association only upon ceasing
to write insurance which 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 to be bound by the plan of
8
operation, and upon withdrawal, all unpaid premiums which Have been
charged to the withdrawing member shall be payable as of the effec-
tive date of the withdrawal.
(5) An unsatisfied net liability to the association of an insol-
vent member shall be assumed by and apportioned among the remaining
members of the association as provided in the plan of operation. The
association shall have all rights allowed by law on behalf of the
remaining members against the estate or funds of the insolvent member
for sums due the association.
(6) When a member has been merged or consolidated into another
insurer or another insurer has reinsured a member's entire business
which provides the security required by section 3101(1) in this
state, the member and successors in interest of the member shall
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 t00`! of all liability as provided in subsection (2).
(b) Establish procedures by which members shall promptly report to
the association each claim which, on the basis of the injuries or
damages sustained, may reasonably be anticipated to involve the asso-
ciation if the member >.s ultimately held legally liable for the inju-
ries or damages. Solely for the purpose of reporting claims, the
member shall in all instances consider itself legally liable for the
injuries or damages. The member shall also advise the association of
subsequent developments likely to materially affect the interest of
the association in the claim.
(c) Maintain relevant loss and expense data relative to all
liabilities of the association and require each member to furnish
statistics, in connection with liabilities of the association, at the
times and in the form and detail as may be required by the plan of
operation.
,mo(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 which
the association will likely incur during the period for which the
premium is applicable. The premium shall include an amount to weer
incurred but not reported losses for the period and may be adjusted
for any excess or deficient premiums frao previous periods. Excesses
or deficiencies from previous periods may be fully adjusted in a
single period or may be ad]usted over several periods >.n a manner
provided for in the plan of operation. Each member shall be charged
an amount equal to that member's total earned car pears of insurance
providing the security required by section 3101(1) or 3103(1), or
both, written in this state during the period to which the premium
applies, multiplied by the average premium per car. The average pre-
mium per car shall be the total premium calculated divided y the
total earned car years of insurance providing the security required
by section 3101(1) or 3103(1) written in this state of all members
during the period to which the premium applies. As used in this sub-
division, "car" includes a motorcycle.
(e) Require and accept the pa ent of premiums from members of the
association as provided for in the plan of operation. The association
shall do either of the following:
9
(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 required by the operation of
the association.
(g) Establish procedures for reviewing claims procedures and prac-
tices 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 ma undertake or
may contract with another person, including another member, to adjust
or assist in the adj7ustment of claims for the member on claims which
create a potential liabilit 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 not create any direct liability against
the individual members of the association. The association may pro-
vide for the indemnification of its members, members of the board of
directors of the association, and officers, employees, and other per-
sons lawfully acting on behalf of the association.
fib) Reinsure all or any portion of its potential liability with
reinsurers licensed to transact insurance in this state or approved
by the commissioner.
(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 dele-
gate 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 oz without this state to assure the efficient operation of the
association.
(f) Sear 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
which are necessary or proper to accomplish the purposes of the asso-
ciation and which 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 the asso-
ciation consistent with the plan of operation and this section.
(t0) The plan of operation shall provide for all of the following:
(a) The establishment of necessary facilities.
10
(b) The management and operation of the association.
(c) A preliminary premium, payable by each member in proportion to
its total first-year premium, for initial expenses necessary to com-
mence operation of the association.
(d) Procedures to be utilized in charging premiums, including
adjustments from excess oc deficient premiums from prior periods.
(e) Procedures governing the actual payment of premiums to the
association.
(f) Reimbursement of each member of the board by the association
for actual and necessary expenses incurred on association business.
(g) The investment policy of the association.
(h) Any other matters required by or necessary to effectively
implement this section.
(II) Not more than 30 daps after the effective date of this sec-
tion, the commissioner shall convene an organizational meeting of the
board. The board shall be initially composed of 5 members of the
association appointed by the commissioner to serve as directors, and
the commissioner or a designated representative of the commissioner
serving as an ex officio member of the board without vote. The ini-
tial board and each successor board shall include members which would
contribute a total of not less than 40$ of the total premium calcu-
lated pursuant to subsection (7)(d). Each director shall be entitled
to I vote. The initial term of offffice of a director shall be 2 years.
(12) As part of the plan of operation, the board shall adopt rules
providing for the composition and term of successor boards to the
initial board, consistent with the membership composition require-
ments in subsections (II) and (13). Terms of the directors shall be
staggered so that the terms of all the directors do not expire at the
same time and so that a director does not serve a term of more than 4
years.
(13) The board shall consist of 5 directors and the comnussioner
shall be an ex officio member of the board without vote.
(14) Each director shall be appointed by the commissioner and
shall serve until that member's successor is selected and qualified.
The chairperson of the board shall be elected by the board. A vacancy
on the board shall be filled by the commissioner wnsistent with the
plan of operation.
(IS) After the board is appointed, the board shall meet as often
as the chairperson, the commissioner, or the plan of operation shall
require, or at the request of any 3 members of the board. The chair-
person shall retain the right to vote on all issues. Four members of
the board shall constitute a quorum.
(16) An annual report of the operations of the association in a
form and detail as may be determined by the board shall be furnished
to each member.
(17) Not more than 60 days after the initial organizational meet-
ing of the board, the board shall submit to the commissioner for
approval a proposed plan of operation consistent with the ob]'ectives
and provisions of this section, which shall provide for the
economical, fair, and nondiscriminatory administration of the
association and for the promQt and efficient provision of indemnity.
If a plan is not submitted within this 60-day period, then the com-
missioner, 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. Zf the board fails to
submit a revised plan of operation which 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 objec-
tives of this section.
(19) The proposed plan of operation or amendments to the plan of
operation shall be subject to majority approval by the board, rati-
fied by a majoritx of the membership having a vote, with voting
rights being apportioned according to the preauums charged in subsec-
tion (7)(d) and shall be subject to approval by the commissioner.
(20) Upon approval by the commissioner and ratification by the
members of the plan submitted, or upon the promulgation of a plan by
the commissioner, each insurer authorized to write insurance provid-
ing the security required by section 3101(1) in this state, as
defined in this section, shall be bcind by and shall formalla+ sub-
scribe to and participate in the plan approved as a condition of
maintaining its authority to transact insurance in this state.
(21) The association shall be subject to all the reporting, loss
reserve, and investment r irements of the commnissioner to the same
extent as would a member of the association.
(22) Premiums charged members by the association shall be recog-
nized in the rate-making procedures for insurance rates in the same
manner that expenses and premium taxes are recognized.
(23) The commissioner or an authorized representative of the com-
missioner may visit the association at any time and examine any and
all the association's affairs.
(24) This section shall take effect on July 1, 1978. The associa-
tion shall not have liability for losses occurring before the effec-
tive date of this section.
History: Add. 1978, Act 136, Eff. July 1, 1978;--Am. 1980, Act
445, Imd. Eff. Jan. 15, 1981.
Cited in other sections: Section 500.3104 is cited in S 124.9.
XXXX 500.3104.amended THIS AMENDED SECTION IS NOT EFFECTIVE
UNLESS APPROVED BY A MAJORITY OF THE ELECTORS VOTING
THEREON AT THE NOVEMBER 8, 1994 GENERAL ELECTION XXXX
500.3104 Excess PIP association; creation; seobership as condition
of authority to transact insurance; laws to which association
subject; indesinification for ultioate loss; aswunts; withdrawal
froe association; effect of ter~inatian by withdrawal; unsatisfied
net liability of insolvent oenber; liability upon verger,
consolidation, or reinsurance of business; powers and duties of
12
association; creation and responsibility of board of directors•
provisions of plan of operation; appointment, qualifications, and
terms of directors; voting; rules; election of c2~airperson; vacan-
cy; meetings; quorum; annual report; plan of operation required;
reporting, loss cesecve, and investment requirements; rec.~ognation
of premiums in rate-making procedures; examining affairs of asso-
ciation; liability for losses; assessments to rernup deficiencies
in MCCA account; applicability of change in amounts in subsection
(2); separate accounts; prohibition; definitions.
Sec. 3104. (I) An unincorporated, nonprofit association to be
known as the excess PIP 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 this state, as a condition of its authority to transact insur-
ance in this state, shall be a member of the association and shall be
bound by, the plan of operation of the association. Each insurer
engaged in writing insurance coverages that provide the security
required by section 3103(1) within this state, as a condition of its
authority to transact insurance in this state, shall be considered a
member of the association, but only for purposes of assessments under
subsection (7)(d). Except as expressly provided in this section, the
association shall not a subject to any laws of this state with
respect to insurers, but in all other respects the association shall
be subject to the laws of this state to the extent that the associa-
tion would be were it an insurer organized and subsisting under chap-
ter 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 fol-
lowing amounts in each loss occurrence:
(a) For an automobile policy issued or renewed before 300 dais
after the effective date of the amendatory act that added this subdi-
vision, $250,000.00.
(b) For an automobile policy issued or renewed 300 days to and
including 665 days after the effective date of the amendatory act
that added this subdivision, $300,000.00.
(c) For an automobile policy issued or renewed 666 daps to and
including 1031 days after the effective date of the amendatory act
that added this subdivision, $400,000.00.
(d) For an automobile policy issued or renewed on and after 1032
days after the effective date of the amendatory act that added this
subdivision, $500,000.00, adjusted annually every October t by the
lesser of St or the wnsumer price index, and zounded up to the near-
est $25,000.00.
(3) An insurer may withdraw from the association only upon 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 termi-
nated by withdrawal shall continue to be bound by the plan of opera-
tion, and upon withdrawal, all unpaid premiums that have been charged
to the withdrawing member shall be payable as of the effective date
of the withdrawal.
(5) An unsatisfied net liability to the association of an
insolvent member shall be assumed by and apportioned among the
13
remaining members of the association as provided in the plan of
operation. The association shall have all rights allowed by law on
behalf of the remaining members against the estate or funds of the
insolvent member for sums 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 shall 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 1008 of all liability as provided in subsection (2).
(b) Establish procedures by which members shall promptly report to
the association each claim that, on the basis of the injuries or dam-
ages sustained, may reasonably be anticipated to involve the associa-
tion 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 inju-
ries or damages. The member shall also advise the association of sub-
sequent developments likely to materially affect the interest of the
association in the claim.
(c) Maintain relevant loss and expense data relative to all
liabilities of the association and require each member to furnish
statistics, in connection with liabilities of the association, at the
times and in the form and detail as may be required by the plan of
operation.
(d) Subject to subsection (25), 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 ex cted losses and expenses
of the association that the association will likely incur during the
period for which the premium is applicable. The premium shall include
an amount to cover incurred but not reported losses for the period
and may be adjusted for any excess or deficient premiums from previ-
ous periods. Excesses or deficiencies from previous periods may be
fully adjusted in a single pperiod or may be adjusted over several
periods in a manner provided for in the plan of operation. Each
member shall be charged an amount equal to that members total earned
car years of insurance providing the security required by section
3101(1) or 3t03(1~, or both, written in this state during the period
to which the premium applies, multiplied by the average premium per
car and adjusted to reflect the amount of coverage selected by each
member's insureds under section 3107. The average premium per car
shall be the total premium calculated divided by the total earned car
years of insurance providing the security required by section 3101(1)
or 3103(1) written in this state of all members durrnc~ the period to
which the premium applies. As used in this subdivision, "car"
includes a motorcycle.
(e) Require and accept the pa ent of premiums from members of the
association as provided for in the plan of operation. The association
shall do either of the following:
(4) 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.
14
(f) Receive and distribute all sums required by the operation of
the association.
(g) Establish procedures for reviewing claims procedures and prac-
tices 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 ma 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 not create any direct liability against
the individual members of the association. The association may pro-
vide for the indemnification of its members, members of the board of
directors of the association, and officers, employees, and other per-
sons 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.
(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 dele-
gate 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 or without 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 asso-
ciation 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 the asso-
ciation consistent with the plan of operation and this section.
(10) The plan of operation shall 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.
IS
(d) Procedures governing the actual payment of premiums tc the
association.
(e) Reimbursement of each member of the board by the association
for actual and necessary expenses incurred on association business.
(f) The investment policy of the association.
( ) Any other matters required by or necessary to effectively
implement this section.
(II) Each board shall include members that would contribute a
total of not less than 40$ of the total premium calculated pursuant
to subsection (7)(d?. Each director shall be entitled to 1 vote. The
initial term of office of a director shall be 2 years.
(12) As part of the plan of operation, the board shall adopt rules
providing for the composition and term of successor boards to the
initial board, consistent with the membership composition require-
ments in subsections (11) and (13). Terms of the directors shall be
staggered so that the terms of all the directors do not expire at the
same time and so that a director does not serve a term of more than 4
years.
(13) The board shall consist of 5 directors and the commissioner
shall be an ex officio member of the board without vote.
(14) Each director shall be appointed by the commissioner and
shall serve until that member's successor is selected and qualified.
The chairperson of the board shall be elected by the board. A vacancy
on the board shall be filled by the conenissioner consistent with the
plan of operation.
(15) After the board is appointed, the board shall meet as often
as the chairperson, the commissioner, or the plan of operation shall
require, or at the request of any 3 members of the board. The chair-
person shall retain the right to vote on all issues. Four members of
the board shall constitute a quorum.
(16) An annual report of the operations of the association in a
form and detail as may be determined by the board shall be furnished
to each member.
(17) Not more than 60 days after the initial organizational meet-
ing 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 econaui-
cal, 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 Eails 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
16
place into effect a plan consistent with the requirements and
objectives of this section.
(19) The proposed plan of operation or amendments to the plan of
operation shall be subject to majority approval by the board, rati-
fied by a majoritx of the membership having a vote, with voting
rights being apportioned according to the premiums charged in subsec-
tion (7)(d) and shall be subject to approval by the commissioner.
(20) Upon approval by the commissioner and ratification by the
members of the plan submitted, or upon the promulgation of a plan by
the commissioner, each insurer authorized to write insurance provid-
ing the security required by section 3101(1) in this state, as pro-
vided in this section, shall be bound by and shall formally subscribe
to and participate in the plan approved as a condition of maintaining
its authority to transact insurance in this state.
(2t) The association shall be subject to all the reporting, loss
reserve, and investment requirements of the commissioner to the same
extent as would a member of the association.
(22) Premiums charged members by the association shall be recog-
nized in the rate-making procedures for insurance rates in the same
manner that expenses and premium taxes are recognized.
(23) The commissioner or an authorized representative of the com-
missioner may visit the association at any time and examine any and
all the association's affairs.
(24) The association shall not have liability for losses occurring
before July I, 1978.
(25) Notwithstanding any other provisions of this section, the
association is authorized to assess members to recoup a deficiency
that exists in the MCCA account established under subsection (27)
only as provided in this subsection. The association shall evaluate
annually the assets and liabilities of the association and determine
if a deficiency exists. if a deficiency does exist, the association,
in accordance with the plan of operation, shall assess members annu-
ally as follows:
(a) If the deficiency is less than $100,000,000.00, the full
amount of the deficiency.
(b) If the deficiency is greater than or equal to $100,000,000.00,
the greater of $100,000,000.00 or 12't of the deficiency.
(c) if an assessment under subdivision (a) or (b) is insufficient
to permit the association to meet its payments, then the assessment
shall be increased to an amount sufficient to meet those payments.
(26) Any change in the amounts listed in subsection (2) applies
only to policies issued or renewed on and after the date of the
change in the amount.
(27) The association shall maintain 2 separate accounts out of
which members shall be indemnified for ultimate loss. An MCCA account
shall indemnify for losses arising under policies issued or renewed
effective before 120 days after the effective date of the amendatory
act that added this subsection. Art excess PIP account shall indemnifyy
for losses arising out of policies issued or renewed on and after t20
days after the effective date of the amendatory act that added this
17
subsection. Each account shall be self-supporting and there shall be
no transfer of assets or liabilities between accounts.
(28) Beginning 120 days after the effective date of the amendatory
act that added this subsection, an insurer shall be prohibited from
separating the premium paid to either association from the personal
protection premium stated on an automobile insurance declaration
page.
(29) As used in this section:
(a) "Consumer price index" means the annual average percentage
increase in the Detroit consumer price index for all items for the
prior 12-month period as reported by the United States department of
labor and as certified by the commissioner.
(b) "Ultimate loss" means the actual loss amounts that a member is
obligated to pay and that are paid or payable by the member, and
shall not include claim expenses. An ultimate loss is incurred by the
association on the date that the loss occurs.
History: Add. 1976, Act 136, Eff. July 1, 1978;--Am. 1980, Act
445, Imd. Eff. Jan. I5, 1981;--Am. 1993, Act 143, Eff. (pending).
Cited in other sections: Section 500.3104 is cited in $ 124.9.
XXXX 500.3104a.added THIS ADDED SECTION IS NOT EFFECTIVE
UNLESS APPROVED BY A MAJORITY OF THE ELECTORS VOTING
THEREON AT THE NOVEMBER 8, 1994 GENERAL ELECTION XXXX
500.3104a Personal injury protection task force; creation; appoint-
ment; plan to reduce costs for automobile related injuries;
report.
Sec. 3104a. (t) There is created a personal injury protection task
force. The personal injury protection task force shall consist of
members appointed by the commissioner.
(2) The personal injury protection task force shall prepare a plan
to reduce the costs associated with automobile related injuries
including catastrophic claims. The plan shall include but is not
limited to the following:
(a) The study of the issue of structured settlements.
(b) The examination of the use of managed care, preferred provider
arrangements, case management, treatment protocols, utilization
review, rehabilitation, and other contractual arrangements. The exam-
ination of case management shall include the methods currently used
by insurers and providers and may be extended to include an experi-
mental case management process using criteria developed by the per-
sonal injury protection task force that would then be implanented by
insurers, providers, and injured persons who volunteer to participate
in the experimental case management process.
(c) The proposal of standards for assessing injuries and progno-
sis, making treatment goals, and implementing treatment.
(d~ The investigation of cost shifting and other suspected abuses
within the system including recommendations on limiting coats associ-
ated with rehabilitation and home and vehicle modification abuses.
18
(e) The examination of the mix of potential structures and options
for delivery of products, services, and accommodations.
(f) The study of the use of qualified review and the use of inde-
pendent medical examination.
(3) The personal injury protection task force shall report the
plan to the governor and the senate and house of representatives
standing committees on insurance issues by not later than IS months
after the effective date of this section.
History: Add. 1993, Act 143, Eff. (pending).
500.3104b Clinical care management; use; duties of automobile
insurer and clinical care manager; definitions.
Sec. 3104b. (1) An automobile insurer shall use clinical care man-
agement for each insured whose personal protection insurance benefits
are expected to exceed the current indemnification amount listed in
section 3104(2).
(2) An automobile insurer shall do the following:
(a) Develop clinical care management enrollment forms and
procedures.
(b) Develop procedures for an injured person to select a clinical
care manager and for the insurer to appoint a clinical care manager
for those injured persons who do not select a clinical care manager.
(c) Neither appoint nor contract for clinical care management
services with itself, an entity in which it has a financial interest,
or another automobile insurer.
(d) Require an injured person to designate a clinical care manager
prior to authorizing payment for services.
(e) Reimburse each clinical care managec reasonable fees for the
development, management, and update of a clinical care management
plan.
(3) A clinical care manager shall do the following:
(a) Submit an initial clinical care management plan with an
insurer within 60 days of the insurer's request for a clinical care
management plan.
(b) Develop a new clinical care management plan for an injured
person expected to incur allowable expenses for a period which will
exceed the duration of an initial or succeeding clinical care manage-
ment plan.
(c) Consult with the treating ph sician and consider in any clini-
cal care management plan recommendations submitted by the injured
person's treating physician on all matters relating to medical neces-
sity and medical care services within the scope of practice of physi-
cians licensed in this state.
(d) Maintain patient-physician confidentiality.
(9) As used in this section:
19
(a) "Clinical care management plan" means a written plan of a
duration not greater than 6 months developed and documented by or
under the direction of a clinical care manager setting forth the care
and other products, services, and accommodations for an injured
person's care, treatment, recovery, and rehabilitation. A clinical
care management plan shall list and explain all services that are to
valsrdetermined bysthedclinicalrcare manage~rr Arrevised clinicalncare
management plan may be developed before 6 months have expired if an
injured person's condition or needs change. An injured person, some-
body authorized to speak and act on the injured person's behalf, or a
health care provider may initiate a written request for a revised
clinical care management plan. A request shall include the rationale
for the revision.
(b) "Clinical care manager" means a licensed medical or osteo-
pathic doctor, physiatrist, psychologist, nurse, social worker, or
physical or occupational therapist who provides the type of care nec-
essarX for the injured person's care, treatment, recovery, or
rehabilitation.
History: Add. 1993, Act 193, Eff. (pending);--Am. 1994, Act 28,
Eff. Apr. 1, 1994,
500.3105 Insurer liable for personal protection benefits without
regard to fault; "bodily injury" and "accidental bodily injury
defined.
Sec. 3105. (I) Under personal protection insurance an insurer is
liable to pay benefits for accidental bodily injury arising out of
the ownership, operation, maintenance or use of a motor vehicle as a
motor vehicle, subject to the provisions of this chapter.
(2) Personal protection insurance benefits are due under this
chapter without regard to fault.
(3) Bodily injury includes death resulting therefrom and damage to
or loss of a person's prosthetic devices in connection with the
injury.
(4) Bodily injury is accidental as to a person claiming personal
protection insurance benefits unless suffered intentionally by the
injured person or caused intentionallyy by the claimant. Even though a
person knows that bodily in7'ury is substantially certain to be caused
by his act or omission, he does not cause or suffer injury intention-
ally if he acts or refrains from acting for the purpose of averting
injury to property or to any person including himself.
History: Add. 1972, Act 294, Eff. Mar. 30, 1973.
500.3106 Accidental bodily injury arising out of ownership, ra-
tion, aaintenance, or use of parked vehicle as actor vehicle;
conditions.
Sec. 3106. (I) Accidental bodily injury does not arise out of the
ownership, operation, maintenance, or use of a parked vehicle as a
motor vehicle unless any of the following occur:
(a) The vehicle was parked in such a way as to cause unreasonable
risk of the bodily injury which occurred.
(b) Except as provided in subsection (2), the in7'ury was a direct
result of physical contact with equipment permanently mounted on the
20
vehicle, while the equipment was being operated or used, or property
being lifted onto or lowered from the vehicle in the loading or
unloading process.
(c) Except as provided in subsection (2), the injury was sustained
by a person while occupying, entering into, or alighting from the
vehicle.
operatAon,dmaintenancelyornuse of aeparkedavehicletasfatmotornvehhcle
if benefits under the worker's disability com
Act No. 317 of the Public Acts of 1969, as amended,obeing sections
418.101 to 918.941 of the Michigan Compiled Laws, or under a similar
law of another state or under a similar federal law, are available to
an employee who sustains the injury in the course of his or her
employment while doing either of the following:
(a) Loadine~, unloading, or doing mechanical work on a vehicle
unless the injury arose from the use or operation of another vehicle.
As used in this subdivision, "another vehicle" does not include a
motor vehicle being loaded on, unloaded from, or secured to, as cargo
or freight, a motor vehicle.
(b) Entering into or alighting from the vehicle unless the injury
was sustained while entering into or alighting from the vehicle imme-
diately after the vehicle became disabled. This subdivision shall not
apply if the injury arose from the use or operation of another
vehicle. As used in this subdivision, "another vehicle" does not
include a motor vehicle being loaded on, unloaded from or secured to,
as cargo or freight, a motor vehicle.
History: Add. 1972, Act 294, Eff. Mar. 30, 1973;--Am. 1981, Act
209, Eff. Jan. I, 1982;--Am. 1986, Act 318, Eff. June 1, 1987,
Compiler's note: Section 2 of Act 209 of 1981 provides: "This
amendatory act shall take effect January 1, 1982 and shall be appli-
cable to all causes of action which occur after the effective date of
this amendatory act."
XXOXX 500.3107 THIS SECTION IS AMENDED IF 1993 PA 143 IS
APPROVED BY A MAJORITY OF THE ELECTORS VOTING THEREON AT
THE NOVEMBER 8, 1999 GENERAL ELECTION: See
'mc1.00500.03107.amended XXOXX
500.3107 Ex nses and work loss for which personal protection bene-
fits payable.
Sec. 3107. (1) Except as provided in subsection (2) rsonal ro-
tection insurance benefits are payable for the followieng: p
(a) Allowable expenses consisting of all reasonable chargges
incurred for reasonably necessary products, services and accommda-
tions for an injured person's care, recovery, or rehabilitation.
Allowable expenses within personal protection insurance coverage
shall not include charges for a hospital room in excess of a reason-
able and customary charge for semiprivate accommodations except if
the injured person requires special or intensive care, or for funeral
and burial expenses >.n the amount set forth in the policy which shall
not be less than $1,750,00 or more than $5,000.00.
personwwouldohaveopnerfozmedoduring t~lfirat 3 yearsoafter the date
of the accident if he or she had not been injured. Work loss does not
2I
include any loss after the date on which the injured person dies.
Because the benefits received from personal protection insurance for
loss of income are not taxable incase, the benefits payable for such
loss of income shall be reduced 15$ unless the claimant presents to
the insurer in support of his or her claim reasonable proof of a
lower value of the incase tax advantage in his or her case, in which
case the lower value shall apply. Beginning March 30, 1973, the bene-
fits 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 not exceed $1,000.00, which maxisntm shall apply
pro rata to any lesser period of work loss. Beginning October I,
1974, the maximum shall be adjusted annually to reflect changes in
the cost of living under rules prescribed by the commissioner but any
Change in the maximum shall apply only to benefits arising out of
accidents occurring subsequent to the date of change in the maximum.
(c~ Expenses not exceeding $20.00 per day, reasonably incurred in
obtaining ordinary and necessary services a,n lieu of those that, if
he or she had not been injured, an injured person would have per-
formed during the first 3 years after the date of the accident, not
for incase but for the benefit of himself or herself or of his or her
dependent.
(2) 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 sigsing 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 cov-
erage for work loss benefits applies only to work loss benefits pay-
able to the person or persons who have signed the waiver foam.
History: Add. 1972, Act 294, Eff. Mar. 30, 1973;--Am. 1988, Act
312, Eff. Mar. 30, 1989;--Am. 1991, Act 191, Eff. Jan. I, 1992.
Constitutionality: The legislature did not violate constitutional
due process or equal protection in providing for cost-of-living
increases for no-fault insurance work loss benefits under subdivision
(b) of this section, but not for no-fault insurance survivors' loss
benefits under S 500.3108. Davey v. Detroit Automobile
Intez-Insurance Exchange, 414 Mich. I, 322 N.W.2d 541 (t982).
Administrative rules: R 500.811 of the Michigan Administrative
Code.
XXXX 500.3107.amended THIS AMENDED SECTION IS NOT EFFECTIVE
UNLESS APPROVED BY A MAJORITY OF THE ELECTORS VOTING
THEREON AT THE NOVEMBER 8, 1994 GENERAL ELECTION XXXX
500.3107 Ex saes and work lass for which personal protection bene-
fits payable; requireoents applicable to subsection (1); waiver;
requirements applicable to ically appropriate pr acts, aerv-
icea, and accoiodationa; ~eimbursesent to provider; duplicate
benefits; failure to pay; health care provider defined.
Sec. 3107. (I) Except as provided in subsection (3), personal pro-
tection insurance benefits are payable for the following:
(a) Allowable expenses that, for policies issued or renewed on or
after 120 days after the effective date of the amendatory act that
added subsection (7), are as provided in subparagraphs (i) and (ii),
incurred for medically appropriate products, services, and
accommodations for an in7uced person's care, recovery, or
22
rehabilitation. For policies issued or renewed on or after t20 days
after the effective date of the amendatory act that added
subsection (7) and on forms approved by the commissioner, an insurer
shall offer the following coverages and an insured shall select in
writing I of the following coverages:
(i) Coverage for allowable expenses consisting of all reasonable
charges incurred up to a maximum of $1,000,000.00 for medicallyy
appropriate products, services, and accommodations for an inured
person s care, recovery, or rehabilitation. This limit shall be
adjusted up annually by the commissioner beginning October I, 1993 so
that 998 of personal protection insurance benefit claims are fully
covered by the limit provided for in this subparagraph. Any change in
the limit applies only to benefits arising out of accidents occurring
after the date of the change in the limit.
(ii) Coverage for allowable expenses consisting of all reasonable
charges incurred up to $2,000,000.00, $3,000,000.00, $4,000,000.00,
or $5,000,000.00 maxunums as selected by the insured, and the insurer
may offer additional coverage limits, for medically appropriate prod-
ucts, services, and accommodations for an injured person's care,
recovery, or rehabilitation. Any change in the limits applies only to
benefits arising out of accidents occurring after the date of the
change in the limit.
(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 in7'ured. Work loss does not
include any loss after the date on which the injured Person dies.
Because the benefits received fran personal protection insurance for
loss of income are not taxable income, the benefits payable for such
loss of income shall be reduced 158 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. Beginning March 30, 1973, the bene-
fits payable for work loss sustained in a single 30-day period and
income earned by an injured person for work during the same period in
an amount that together shall not exceed $1,000.00, which maximum
applies pro rata to any lesser period of work loss. Beginning
October I, 1974, the maximum shall be adjusted annually every
October I to reflect changes in the coat of living under rules pre-
scribed by the commissioner but any change in the maximum applies
only to benefits arising out of accidents occurring after the date of
change in the maximum.
(c~ Expenses not exceeding $20.00 per da~+ reasonably incurred in
obtaining ordinary and necessary services >:n lieu of those that, if
he or she had not been injured, an injured person would have per-
formed during the first 3 pears after the date of the accident, not
for income but for the benefit of himself or herself or of his or her
dependent.
(2) The following apply to subsection (I):
(a) If an insured fails to select in writing on a form approved by
the commissioner 1 of the coverages in subsection (1)(a), an insurer
shall provide coverage in the amount set forth in
subsection (1)(a)(i).
(b) Coverage limits under subsection (t)(a) are provided on a per
individual per loss occurrence basis. Coverage under
subsection (I)(a) applies only to benefits payable to the insured
23
named in the policy, the insured's spouse, and any relative of either
domiciled in the same household.
(c) A person who is not an insured named in a policy, the
insured s spouse, or a relative of either domiciled in the same
household is entitled only to coverage in the limit set forth in
subsection (t)(a)(i).
(d) Personal protection insurance benefits are limited to the
limit set forth in subsection (t)(a)(i) per individual per loss
occurrence for accidents occurring in the state of Michigan if the
injured person is a nonresident of Michigan and the injured person's
benefits are payable under a policy delivered outside of Michigan
only if eligible under section 3163.
(e) Personal protection insurance benefits are not payable to a
nonresident injured in an accident occurring outside of Michigan to
the extent the nonresident recovers medical or disability benefits
under any other policy. If personal protection insurance benefits are
payable to a nonresident under this subdivision, the benefits are
limited to the limit set forth in subsection (t)(a)(i) per individual
per loss occurrence.
(3) Each insurer transacting automobile insurance in this state
shall offer a waiver to each person who is 60 years of age or older
and in the event of an accidental bodily injurX would not be eligible
to receive work loss benefits under subsection (t)(b). 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.
(4) As used in this section:
(a) Medically appropriate products, services, and accommodations
rendered or prescribed by a health care facility or health care pro-
vider are those that are medically necessary and do not include prod-
ucts, services, and accommodations that would have been needed or
used b~+ the injured person or a member of the injured person's house-
hold without regard to the loss occurrence. Under no circumstances
shall an insurer be required to provide coverage for any product,
service, or accomrodation that is not medically appropriate and medi-
cally necessary for an injured person's care, recovery, or rehabili-
tation and reasonably likely to provide continued effectiveness with
respect to the injured person's care, recovery, or rehabilitation. If
an insured wants durable medical equipment that is more expensive
than what the insurer has determined is actually medically appropri-
ate and medically necessary, the coat of the equipment that the
insurer has determined is medically appropriate and medically neces-
sary shall be paid as partial payment for the durable medical equip-
ment that the insured desires. If reimbursement for a product, serv-
ice, or accommodation rendered or prescribed is initially rejected in
whole or in part by an insurer as not being medically appropriate and
medically necessary, the insurer, at the provider s request, shall
have the decision reexamined by a provider who has the same license,
certification, or registration as the provider who provided the prod-
uct, service, or accommodation being reexamined or who has a license,
registration, or certification with a scope of practice that includes
the scope of practice of the license, registration, or certification
of the provider who provided the product, service, or accommodation
being reexamined. Each insurer shall designate a person with whom
providers can discuss insurer determinations of what is medically
appropriate and medically necessary. Disputes over reasonable charges
24
and medically appropriate and medically necessary products, services,
and accommodations shall be a question of law to be decided by the
court.
(b~ Expenses within personal protection insurance coverage shall
not include charges for a hospital room in excess of a reasonable and
customary charge for semiprivate accommodations except if the injured
person requires special or intensive care, including but not limited
to care provided y a psychiatric unit, or for funeral and burial
expenses in excess of the amount set forth in the policy which shall
not be less than $1,750.00 or more than $5,000.00.
(c) Expenses within personal protection insurance coverage shall
not include experimental treatment or participation in research
projects.
(d) Expenses for attendant care services provided by a hone health
agency are limited to the reasonable and customary charge of the
agency for the appropriate skill level and time intensity of service.
Expenses for attendant care services for home health care provided by
licensed or unlicensed persons, including a member of the same house-
hold whether or not he or she is employed by a home health agency,
are limited to the customary wage the individual would have received
if in the employ of a home health agency commensurate with the
person's qualifications. Expenses for attendant care services for
supervision by members of the same household will not be covered in
excess of 16 hours per day. Attendant care provided continuously for
more than 6 months may be limited to quadriplegic spinal cord, brain
injured, or similarly injured persons as diagnosed by the injured
person's physician. As used in this subdivision, "attendant" means an
individual who provides assistance to the injured person with activi-
ties of daily living including but not limited to ambulating, feed-
ing, grooming, dressing, toileting, transfers, and supervision that
may be re wired for safety of the injured person. An attendant ma be
a trained nurse or nursing assistant but an attendant providing
attendant care shall not be reimbursed for practicing the profession
of nursing.
(e) Expenses for skilled home care provided by a home health
agency are limited to the reasonable and customary charge of the
agency for the appropriate skill level and time intensity of service.
Expenses for skilled home care provided by licensed or unlicensed
persons, including a member of the same household whether or not he
or she is employed by a home health agency, are limited to the cus-
tomarpp wagge the individual would have received if in the employ of a
home f~ealth agency commensurate with the person's qualifications.
Expenses for skilled home care by members of the same household will
not be covered in excess of 16 hours per day.
(f) Expenses for medically appropriate psychological services that
are reasonably likely to produce significant measurable improvement
in the injured person's psychological status and that are prescribed
by a physician or licensed psychologist shall be limited to a
fixed-duration time period not to exceed 26 weeks and shall apply
only if the need for the services arose out of the inured person's
loss occurrence. The services may be extended for I additional time
pperiod not to exceed 26 weeks if the services are reasonably likely
to produce significant measurable improvement in the injured person s
psychological status. The 26 and 52 week period may be extended if it
is reasonably likely that treatment of a longer duration, which may
be intermittent over the years the case is managed, may produce sig-
nificant measurable improvement in the injured person s psychological
or neuropsychological status. Psychological services shall be
25
provided by a person licensed under part 182 of the public health
code, Act No. 368 of the Public Acts of 1978, being sections
333.18201 to 333.18237 of the Michigan Compiled Laws, or by a social
worker registered under article 16 of the occupational code, Act
No. 299 of the Public Acts of 1980, being sections 339.1601 to
339.1610 of the Michigan Compiled Laws.
(g Expenses for medically appropriate vocational rehabilitation
services that are reasonably likely to produce significant rehabili-
tation shall be reimbursed for a fixed-duration time period not to
exceed 52 weeks. The services may be extended for I additional time
period not to exceed 52 weeks if the services are reasonably likely
to produce significant rehabilitation and shall cease once the
injured person has acquired employment skills.
(h) Expenses for home modification accommodations that are func-
tionally necessary to meet the injured person's treatment, rehabili-
tation, maintenance, and daily living needs that are a result of his
or her injuries shall not exceed $50,000.00 adjusted annually to
reflect changes in the cost of living under rules prescribed by the
commissioner but any change in the maximum applies only to benefits
arising out of loss occurrences after the date of change in the
maximum.
(i) Expenses for a special motor vehicle or motor vehicle modifi-
cation accommodations that are functionallx necessary for the vehicu-
lar mobility of the injured person are limited to necessary modifica-
tions to an existing motor vehicle, or if a special motor vehicle is
required, the cost of the special vehicle and the functionall neces-
sary modifications to it that are directly necessitatedy by and
related to the injured person's injuries. Costs for replacement spe-
cial motor vehicles or motor vehicle modifications shall not be
incurred more frequently than once every 7 years and are limited to a
maximum of $50,000.00 every 7 years adjusted annually to reflect
changes in the cost of living under rules prescribed by the
commissioner.
(5~ An insurer shall directly reimburse a provider of services
received pursuant to this chapter unless the insured has already
directly reimbursed the provider of services.
(6) Regardless of the number of motor vehicles insured or insurers
providing security in accordance with this chapter, or the provisions
of any other law providing for direct benefits without regard to
fault for motor or any other vehicle accidents, a person shall not
recover duplicate benefits for the same expenses or losses incurred
under this section.
(7) A health care facility or health care provider shall not bill
an insured or report to a credit reporting agency an insured's fail-
ure to pay for products, services, and accommodations rendered when
an amount is disputed by the insurer or when that amount exceeds the
pa went made by the insurer. If an insured receives medical care from
a health care facility or health care provider for an automobile
accident injury, an assignment of the insured's rights to enforce
coverage and collect medical care payments for services rendered and
products provided by that health care facility or health care pro-
vider automatically passes to the health care facility or health care
provider that rendered the services or provided the products.
(8) This section shall not be interpreted to exclude any health
care provider providing services within the scope of their licensure,
certification, or registration. As used in this subsection, "health
26
care provider" means a person licensed, certified, or registered
under parts 61 to 65 or 161 to 182 of the pNblic health code, Act
No. 368 of the Public Acts of 1978, being sections 333.6101 to
333.6523 and 333.16101 to 333.18237 of the Michigan Compiled Laws.
History: Add. 1972, Act 294, Eff. Mar. 30, 1973;--Am. 1988, Act
312, Eff. Mar. 30, 1989;--Am. 1991, Act 191, Eff. Jan. 1, 1992;--Am.
1993, Act 193, Eff. (pending).
Constitutionality: The legislature did not violate constitutional
due process or equal protection in providing for cost-of-living
increases for no-fault insurance work loss benefits under subdivision
(b) of this section, but not for no-fault insurance survivors' loss
benefits under § 500.3108. Davey v. Detroit Automobile
Inter-Insurance Exchange, 414 Mich. I, 322 N.W.2d 541 (1982).
Administrative rules: R 500.811 of the Michigan Administrative
Code.
500.3107a Basis of work loss for certain injured persons.
Sec. 3107a. Subject to the provisions of section 3107(I)(b), work
loss for an injured person who is temporarily unemployed at the time
of the accident or during the period of disability shall be based on
earned income for the last month employed full time preceding the
accident.
History: Add. 1975, Act 311, Imd. Eff. Dec. 22, 1975;--Am. 1991,
Act 191, Eff. Jan. I, 1992.
500.3108 Survivor's loss; benefits.
Sec. 3108. (1) Except as provided in subsection (2), personal pro-
tection insurance benefits are payable for a survivor s loss which
consists of a loss, after the date on which the deceased died, of
contributions of tangible things of economic value, not including
services, that dependents of the deceased at the time of the
deceased's death would have received for support during their deppeen-
dency from the deceased if the deceased had not suffered the acciden-
tal bodily injury causing death and expenses, not exceeding $20.00
per day, reasonably incurred by these dependents during their depen-
dency and after the date on which the deceased died in obtaining
ordinary and necessary services in lieu of those that the deceased
would have performed for their benefit if the deceased had not suf-
fered the injury causing death. Except as provided in section (2) the
benefits payable for a survivors' loss in connection with the death
of a person in a single 30-day period shall not exceed $1,000.00 for
accidents occurring before October 1, 1978, and shall not exceed
$1,475.00 for accidents occurring on or after October t, 1978, and is
not payable beyond the first three years after the date of the
accident.
(2) The maximum payable shall be adjusted annually to reflect
changes in the cost of living under rules prescribed by the
commissioner. A change in the maximum shall apply only to benefits
arising out of accidents occurring subsequent to the date of change
in the maximum. The maximum shall apply to the aggregate benefits for
all survivors payable under this section on account of the death of
any one person.
History: Add. 1972, Act 294, Eff. Mar. 30, 1973;--Am. 1978, Act
459, Imd. Eff. Oct. 16, 1978.
27
Constitutionality: The legislature did not violate constitutional
due process or equal protection in providing for cost-of-living
increases for no-fault insurance work loss benefits under
§ 500.3107(b), but not for no-fault insurance survivors' loss bene-
fits under this section. Davey v. Detroit Automobile Inter-Insurance
Exchange, 914 Mich. I, 322 N.W.2d 541 (t982).
500.3109 Subtraction of other benefits from personal protection
benefits; "injured person" defined; deductible provision.
Sec. 3109. (I) Benefits provided or required to be provided under
the laws of any state or the federal government shall be subtracted
from the personal protection insurance benefits otherwise payable for
the injury.
(2) An injured person is a natural person suffering accidental
bodily injury.
(3) An insurer providing personal protection insurance benefits
may offer, at appropriately reduced premium rates, a deductible of a
s ecified dollar amount which does not exceed $300.00 per accident.
This deductible may be applicable to all or any specified types of
personal protection insurance benefits but shall apply only to bene-
fits payable to the person named in the policy, his spouse and any
relative of either domiciled in the same household. Any other deduct-
ible provisions require the prior approval of the commissioner.
History: Add. 1972, Act 294, Eff. Mar. 30, 1973.
Constitutionality: In O'Donnel v. State Farm Mutual Automobile
Insurance Company, 404 Mich. 524, 273 N.W.2d 829 (1979), the Michigan
supreme court held that $ 500.3109(1) does not violate the due pro-
cess clause or the equal protection clause of the state or federal
constitutions.
Zn Underhill v. Safeco Insurance Company, 407 Mich. 175, 284
N.W.2d 463 (1979, the Michigan supreme court held that subsection
(3) of this section authorizing the commissioner to approve deducti-
bles was not an unconstitutional delegation of authority.
The Michigan supreme Court in Mathis v. Interstate Motor Freight
System, 408 M;ch, t64, 289 N.W.2d 708 (1980), held that S 500.3109(1)
as applied to workers' canpensation benefits is sustainable under the
equal protection clause of the Michigan constitution.
XXOXX 500.3109a THIS SECTION IS AMENDED IF 1993 PA 143 IS
APPROVED BY A MAJORITY OF TBE ELECTORS VOTING THEREON AT
TBE NOVEMBER 8, 1994 GENERAL ELECTION: See
'mc1.00500.03109a.amended XXOXX
500.3109a Offering deductibles and exclusions reasonably related to
other health and accident coverage; rates; approval;
applicability.
Sec. 3109a. An insurer providing personal protection insurance
benefits shall offer, at appropriately reduced premium rates, deduct-
ibles and exclusions reasonably related to other health and accident
coverage on the insured. The deductibles and exclusions required to
be offered by this section shall be subject to prior approval by the
commissioner and shall apply only to benefits pagable to the person
named in the policy, the spouse of the insured and any relative of
either domiciled in the same household.
28
History: Add. 1974, Act 72, Eff. June 4, 1974,
Constitutionality: In O'Donnel v. State Farm Mutual Automobile
Insurance Company, 404 Mich. 524, 273 N.W.2d 829 (1979), the Michigan
supreme court declared this statute constitutional.
XXXX 500.3109a.amended THIS AMENDED SECTION IS NOT EFFECTIVE
UNLESS APPROVED BY A MAJORITY OF THE ELECTORS VOTING
THEREON AT THE NOVEMBER 8, 1994 GENERAL ELECTION XXXX
500.3109a Offering deductibles and exclusions reasonably related to
other health and accident coverage; rates; approval; applivabil-
ity; health and accident coverage as secorx9ary to personal proter
tion insurance benefits; other coverage not as health and accident
coverage.
Sec. 3109a. (I) An insurer providing personal protection insurance
benefits shall offfer, at appropriately reduced premium rates, deduct-
ibles and exclusions reasonably related to other health and accident
coverage on the insured. The deductibles and exclusions required to
be offered by this section are subject to prior approval by the com-
missioner and apply only to benefits payable to the person named in
the policy, the spouse of the insured, and any relative of either
domiciled in the same household.
(2) Health and accident coverage that does not become effective
until after the date of the injury is secondary to personal protec-
tion insurance benefits for all services related to the injury.
(3) Coveragge under title XVIII of the social securityy act,
chapter 531, 49 Stat. 620, 42 U.S.C. 1395 to 1395b, 1395b-2, 1395c to
13951, 13951-2 to 13951-4, 1395j to 1395t, 1395u to 1395w-2, 1395w-9
to 1395ccc, or title XIX of the social security act, chapter 531, 49
Stat. 620, 42 U.S.C. 1396 to 1396f and 13961 to 1396u, or coverage
pursuant to a medicare supplemental policy or certificate or a con-
tract issued by a health maintenance organization to an individual
eligible for medicare is not considered other health and accident
coverage for purposes of this section.
History: Add. 1974, Act 72, Eff. June 4, 1979; -Am. 1993, Act 143,
Eff. (pending).
Constitutionality- In O'DOnnel v. State Farm Mutual Automobile
Insurance Company, 404 Mich. 524, 273 N.W.2d 829 (1979), the Michigan
supreme court declared this statute constitutional.
500.3110 Dependents of deceased person; teraination of dependency;
accrual of personal protection benefits.
Sec. 3110. (1) The following persons are conclusively presumed to
be dependents of a deceased person:
(a) A wife is dependent on a husband with whom she lives at the
time of his death.
(b) A husband is dependent on a wife with whom he lives at the
time of her death.
(c) A child while under the age of 18 years, or over that age but
physically or mentallyy incapacitated from earning, is dependent on
the parent with whom he lives or from whom he receives support regu-
larly at the time of the death of the parent.
29
(2) In all other cases, questions of dependency and the extent of
dependency shall be determined in accordance with the facts as they
exist at the time of death.
(3) The dependency of a surviving spouse terminates upon death or
remarriage. The dependency of any other person terminates upon the
death of the person and continues only so lone as the person is under
the age of 18 years, physically or mentally incapacitated from earn-
ing, or engaged full time in a formal program of academic or voca-
tional education or training.
(9) Personal protection insurance benefits pa able for accidental
bodily injury accrue not when the injurx occurs but as the allowable
expense, work loss or survivors' loss is incurred.
History: Add. 1972, Act 294, Eff. Mar. 30, 1973.
500.3111 Payment of personal protection benefits for accident
occurring out of state.
Sec. 3111. Personal protection insurance benefits are payable for
accidental bodily injury suffered in an accident occurring out of
this state, if the accident occurs within the United States, its ter-
ritories and possessions or in Canada, and the person whose injury is
the basis of the claim was at the time of the accident a named
insured under a personal protection insurance policy, his spouse, a
relative of either domiciled in the same household or an occupant of
a vehicle involved in the accident whose owner or registrant was
insured under a personal protection insurance policy or has pcovided
security approved by the secretary of state under subsection (4) of
section 3101.
History: Add. 1972, Act 294, Eff. Mar. 30, 1973.
500.3112 Persona to whom Qersonal protection benefits payable; dis-
charge of insurer's liability.
Sec. 3112. Personal protection insurance benefits are payable to
or for the benefit of an injured person or, in case of his death, to
or for the benefit of his dependents. Payment by an insurer in good
faith of personal protection insurance benefits, to or for the bene-
fit of a person who it believes is entitled to the benefits, dis-
charges the insurer's liability to the extent of the payments unless
the insurer has been notified in writing of the claim of souse other
person. If there is doubt about the proper person to receive the ben-
efits or the proper apportionment among the persona entitled thereto,
the insurer, the claimant or any other interested person may apply to
the circuit court for an appropriate order. The court may designate
the pa ees and make an equitable apportionment, taking into account
the relationship of the payees to the injured person and other fac-
tors as the court considers appropriate. In the absence of a wurt
order directing otherwise the insurer may pay:
(a) To the dependents of the injured person, the personal protec-
tion insurance benefits accrued before his death without appointment
of an administrator or executor.
(b To the surviving spouse, the personal protection insurance
benefits due any dependent children living with the spouse.
History: Add. 1972, Act 294, Eff. Mar. 30, 1973.
30
500.3113 Persons not entitled to personal protection benefits.
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 using a motor vehicle or motorcycle which he or
she had taken unlawfully, unless the person reasonably believed that
he or she was entitled to take and use the vehicle.
(b) The person was the owner or registrant of a motor vehicle or
motorcycle involved in the accident with respect to which the secur-
ity 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
was not insured by an insurer which has filed a certification in com-
pliance with section 3163.
History: Add. 1972, Act 294, Eff. Mar. 30, 1973;--Am. 1986, Act
93, Eff. July 8, 1986.
Compiler's note: Section 2 of Act 93 of 1986 provides: "This amen-
datory act shall not apply to causes of action arising before the
effective date of this amendatory act."
500.3114 Persons entitled to personal protection insurance berefits
or personal injury benefits; reooupment barred; order of priority
for claim of motor vehicle occupant or motorcycle operator or pas-
senger; 2 or more insurers in same order of priority; partial
recoupment.
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 s ouse, and a relative of either domiciled
in the same household, if the injury arises from a motorcycle
accident. When 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, rela-
tive, or relative's spouse, the injured person's insurer shall pay
all of the benefits and shall not be entitled to recoupment from the
other insurer.
(2) A person suffering accidental bodily injury while an operator
or a passenger of a motor vehicle operated in the business of trans-
porting passengers shall receive the personal protection insurance
benefits to which the person is entitled from the insurer of the
motor vehicle. This subsection shall not apply to a passenger in the
following, unless that passenger is not entitled to personal protec-
tion insurance benefits under any other policy:
(a) A school bus, as defined by the department of education, pro-
viding transportation not prohibited by law.
(b) A bus operated by a common carrier of passengers certified by
the public service commission.
31
(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 destina-
tion point.
(3) An employee, his or her spouse, or a relative of either domi-
ciled 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 (I) to (3), a person suffer-
ing 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 which 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.
(b) The insurer of the operator of the motor vehicle involved in
the accident.
(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 riority, together with 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.
History: Add. 1972, Act 294, Eff. Mar. 30, 1973;--Am. 1975, Act
137, Imd. Eff. July 3, 1975;--Am. 1976, Act 356, Imd. Eff. Dec. 21,
1976;--Am. 1977, Act 53, Imd. Eff. July 5, 1977;-Am. 1980, Act 445,
Imd. Eff. Jan. I5, 1981;--Am. 1984, Act 372, Imd. Eff. Dec. 27, 1984.
XXOXX 500.3115 THIS SECTION ZS AMENDED IF 1993 PA 143 IS
APPROVED BY A MAJORITY OF THE ELECTORS VOTING THEREON AT
32
THE NOVEMBER 8, 1994 GENERAL ELECTION: See
'mc1.00500.03115.amended XXOXX
500.3115 Priorities as to claims of persons not occupants of vehi-
cle; partial recoupment; limitation on benefits.
Sec. 3115. (1) Except as provided in subsection (I) of section
3114, a person suffering accidental bodily injury while not an occu-
pant of a motor vehicle shall claim personal protection insurance
benefits from insurers in the following order of priority:
(a) Insurers of owners or registrants of motor vehicles involved
in the accident.
(b) Insurers of operators of motor vehicles involved in the
accident.
(2~ When 2 or more insurers are in the same order of priorityy to
provide personal protection insurance benefits an insurer paying ben-
efits due is entitled to partial recoupment from the other insurers
in the same order of priority, together with a reasonable amount of
partial recoupment of the expense of processing the claim, in order
to accomplish equitable distribution of the loss among such insurers.
(3) A limit upon the amount of personal protection insurance bene-
fits available because of accidental bodily injury to 1 person aris-
ing from 1 motor vehicle accident shall be determined without regard
to the number of policies applicable to the accident.
History: Add. 1972, Act 294, Eff. Mar. 30, 1973.
Constitutionality: The legislative scheme which allows motorcy-
clists to receive no-fault benefits for personal in7'uries without
requiring than to maintain no-fault security does not deny automobile
drivers equal protection or due process of law. Underhill v. Safeco
Insurance Company, 407 Mich. 175, 284 N.W.2d 463 (1979).
XXXX 500.3115.amended THIS AMENDED SECTION IS NOT EFFECTIVE
UNLESS APPROVED BY A MAJORITY OF THE ELECTORS VOTING
THEREON AT THE NOVEMBER 8, 1994 GENERAL ELECTION XXXX
500.3115 Priorities as to claims of persons not ocwpants of vehi-
cle; partial recoupment; limitation on benefits; determining limit
of insurance coverage available.
Sec. 3115. (1) Except as provided in section 3114(1), a person
suffering accidental bodily injury while not an occupant of a motor
vehicle shall claim personal protection insurance benefits from
insurers in the following order of priority:
(a) Insurers of owners or registrants of motor vehicles involved
in the accident.
(b) insurers of operators of motor vehicles involved in the
acciddent.
(2~ When 2 or more insurers are in the same order of priority to
provide personal protection insurance benefits an insurer paying n-
efits due is entitled to partial recoupment from the other insurers
in the same order of priority, together with a reasonable amount of
ppaartial recoupment of the expense of processing the claim, in order
to accomplish equitable distribution of the loss among such insurers.
33
(3) A limit upon the amount of personal protection insurance
beneffits available because of accidental bodily injury to I person
arising from 1 motor vehicle accident shall be determined without
regard to the number of policies applicable to the accident.
(4) Regardless of the number of vehicles insured under the policy,
in no event shall the limit of liability for 2 or more motor vehicles
or 2 or more policies be added together, combined, or stacked to
determine the limit of insurance coverage available for each injured
person covered under the policy.
History: Add. 1972, Act 294, Eff. Mar. 30, 1973;--Am. 1993, Act
143, Eff. (pending).
Constitutionality: The legislative scheme which allows motorcy-
clists to receive no-fault benefits for personal in7'uries without
re4uiring them to maintain no-fault security does not deny automobile
drivers equal protection or due process of law. Underhill v. Safeco
Insurance Company, 907 Mich. 175, 284 N.W.2d 463 (1979).
XXOXX 500.3116 THIS SECTION IS AMENDED IF 1993 PA 143 IS
APPROVED HY A MAJORITY OF THE ELECTORS VOTING THEREON AT
THE NOVEMBER 8, 1994 GENERAL ELECTION: See
'uic1.00500.03116.amended XXOXX
500.3116 Value of claim in tort; subtraction from or reimbursement
for benefits.
Sec. 3116. (i) A subtraction from personal protection insurance
benefits shall not be made because of the value of a claim in toct
based on the same accidental bodily injury.
(2) A subtraction from or reimbursement for personal protection
insurance benefits paid or payable under this chapter shall be made
only if recovery /# ** @@ is realized upon a tort clai:a arising from
an accident occurring outside this state, a tort claim brought within
this state against the owner or operator of a motor vehicle with
respect to which the security required by section 3101 (3) and (9)
was not in effect, or a tort claim brought within this state based on
intentionally caused harm to persons or pc rty, and shall be made
only to the extent that the recovery realized by the claimant is for
damages for which the claimant has received or would otherwise be
entitled to receive personal protection insurance benefits. A sub-
traction shall be made only to the extent of the recovery , exclusive
of reasonable attorneys' fees and other reasonable expenses incurred
in effecting the recovery. If personal protection insurance benefits
have already been received, the claimant shall repay to the insurers
out of the recovery a sum equal to the benefits received, but not
more than the recovery exclusive of reasonable attorneys' fees and
other reasonable expenses incurred in effecting the recovery. The
insueer shall have a lien on the recovery to this extent. A recovery
by an inured person or his or her estate for loss suffered by the
person shall not be subtracted in calculating benefits due a depen-
dent after the death and a recovery by a dependent for loss suffered
by the dependent after the death shall not be subtracted in calculat-
ing benefits due the injured person.
(3) A personal protection insurer with a right of reimbursement
under subsection (i), if suffering lose from inability to collect
reimbursement out of a payment received by a claimant upon a tort
claim is entitled to indemnity from a ppeerson who, with notice of the
insurer's interest, made the payment to the claimant without making
the claimant and the insurer joint payees as their interests may
34
appear or without obtaining the insurer's consent to a different
method of payment.
(4) A subtraction or reimbursement shall not be due the claimant's
insurer from that portion of any recovery to the extent that recovery
is realized for noneconomic loss as provided in section 3135(1) and
(2)(b) or for allowable expenses, work loss, and survivor's loss as
defined in sections 3107 to 3110 in excess of the amount recovered by
the claimant from his or her insurer.
History: Add. 1972, Act 294, Eff. Mar. 30, 1973;--Am. 1978, Act
461, Imd. Eff. Oct. 16, 1978.
XXXX 500.3116.amended THIS AMENDED SECTION IS NOT EFFECTIVE
UNLESS APPROVED HY A MAJORITY OF THE ELECTORS VOTING
THEREON AT THE NOVEMBER 8, 1994 GENERAL ELECTION XXXX
500.3116 Value of claim in tort; subtraction from or reimbursement
for benefits.
Sec. 3116. (1) A subtraction from personal protection insurance
benefits shall not be made because of the value of a claim in tort
based on the same accidental bodily injury.
(2) A subtraction from or reimbursement for personal protection
insurance benefits paid or payable under this chapter shall be made
only if recovery is realized upon a tort claim arising from an acci-
dent occurring outside this state, a tort claim brought within this
state against the owner or operator of a motor vehicle with respect
to which the security r fired by section 3101 (3) and (4) was not in
effect, or a tort claim brought within this state based on intention-
ally caused harm to persons or property, and shall be made only to
the extent that the recovery realized by the claimant is for damages
for which the claimant has received or would otherwise be entitled to
receive personal protection insurance benefits. A subtraction shall
be made only to the extent of the recovery, exclusive of reasonable
attorneys' fees and other reasonable expenses incurred in effecting
the recovery. If personal protection insurances benefits have already
been received, the claimant shall repay to the insurers out of the
recovery a sum equal to the benefits received, but not more than the
recovery exclusive of reasonable attorneys' fees and other reasonable
expenses incurred in effecting the recovery. The insurer shall have a
lien on the recovery to this extent. A recovery by an injured person
or his or her estate for loss suffered by the pperson shall not be
subtracted in calculating benefits due a dependent after the death
and a recovery by a dependent for loss suffered by the dependent
after the death shall not be subtracted in calculating benefits due
the injured person.
(3) A personal protection insurer with a right of reimbursement
under subsection (t), if suffering loss from inability to collect
reimbursement out of a payment received by a claimant upon a tort
claim, is entitled to indemnity from a ppeerson who, with notice of the
insurer's interest, made the payment to the claimant without making
the claimant and the insurer 3oint payees as their interests may
appear or without obtaining the insurer's consent to a different
method of payment.
(4) A subtraction or reimbursement shall not be due the claimant's
insurer from that portion of any recovery to the extent that recovery
is realized for noneconomic loss as provided in section 3135(1) and
(3)(b) or for allowable expenses, work loss, and survivor's loss as
35
prescribed in sections 3107 to 3110 in excess of the amount recovered
y the claimant from his or her insurer.
History: Add. 1972, Act 294, Eff. Mar. 30, 1973;__pm. 1978, Act
461, Imd. Eff. Oct. 16, 1978;--Am. 1993, Act 143, Eff. (pending),
XXXX 500.3118.added THIS ADDED SECTION IS NOT EFFECTIVE UNLESS
APPROVED BY A MAJORITY OF THE ELECTORS VOTING THEREON AT
THE NOVEMBER 8, 1994 GENERAL ELECTION XXXX
500.3118 Denial of claim to benefits; appeal; informal
managerial-level conference procedures; conciliation conference;
rules relating to conciliation conference; attorney not required;
effective date of section.
Sec. 3118. (I) A person who has reason to believe that an automo-
bile insurer has improperly denied his or her claim for benefits
shall appeal the denial pursuant to this section before filing an
action for recovery of insurance benefits with the court.
(2) As a condition of its authority to transact automobile insur-
ance in this state, an insurer shall establish reasonable internal
procedures to provide claimants with a private informal
managerial-level conference regarding a dispute over a claim for
benefits. These procedures shall include all of the following:
(a) A notice to the claimant at the time of the denial of all or a
dpart of the claim advising him or her of the right to appeal the
requestinghandgobtaining ahpravate informal manage raleleveloconfer~
ence with the insurer.
(b) A method of providing the claimant, upon request and payment
of a reasonable copying charge, with information pertinent to the
denial, p
theceuthorstyntolresolve claim denialsgonlab nalfvof theainsure~,hwho
shall represent the insurer at the conference.
while protectingotheeainteresta of bothuthe cla ~mtant and the insurei.
(3) The insurer shall file with the commissioner a list of the
person or persona that it has designated to conduct the informal
managerial-level conferenpnces required by this section.
requesthbylaaclaimantllshallllnform therclaimantlin3wrltingaofethe
insurer's decision within 30 daps after the conference, and shall
advise the claimant in writing that if the claimant is not satisfied
with the insurer's decision, the claimant must request a conciliation
conference with the commissioner within 30 days after notice of the
insurer's decision and must proceed with a conciliation conference
with the commissioner before the claimant may file an action for
recovery of insurance benefits with the court.
(5) The commissioner shall provide a conciliation conference
within 30 days after a request p a claimant and shall inform the
claimant in writing of the commissioner's decision within 30 days
after the conciliation conference. The commissioner's recommendation
following a conciliation conference is admissible in any subsequent
court action.
36
(6) The commissioner shall promulgate rules pursuant to the admin-
istrative procedures act of 1969, Act No. 306 of the Public Acts of
1969, being sections 24.201 to 24.328 of the Michigan Compiled Laws,
to establish a procedure for providing a conciliation conference
under this section that shall be reasonably designed to resolve mat-
ters informally and as raQidly as possible, while protecting the
interests of both the claimant and the insurer. The commissioner
shall submit these rules to a public hearing pursuant to Act No. 306
of the Public Acts of 1969 by not later than 180 days after the
effective date of the amendatory act that added this section.
(7) There shall be no requirement for a claimant to have an attor-
ney present at any conference under this section.
(8) This section shall take effect 120 days after the effective
date of the amendatory act that added this section.
History: Add. 1993, Act 143, Eff. (pending).
500.3121 Liability foppr accidental damage to tangible property.
liable to2pay(benefits forpaccidentalcdamagentortaneibleinsurer is
arising out of the ownership, operation, maintenance, or usepofta
motor vehicle as a motor vehicle subject to the provisions of this
section and sections 3123, 3125, and 3127. However, accidental damage
to tangible property does not include accidental damage to tangible
property, other than the insured motor vehicle, that occurs within
the course of a business of repairing, servicing, or otherwise main-
taining motor vehicles.
(2) Property protection insurance benefits are due under the con-
ditions stated in this chapter without regard to fault.
destruct on of the pzopertyeand losssof use ofs the injury to or
injured or destroyed. property so
cleimin smogs to tangible property is accidental, as to a person
g properti+ protection insurance benefits, unless it is suf-
fered or caused intentionally by the claimant. Even though a person
knows that damage to tangible property is substantially certain to be
caused by his or her act or omission, he or she does not cause or
suffergr such damage intentionallyp if he or she acts or refrains from
himselffor herself o refor the rting injury to any person, including
property. purpose of averting damage to tangible
(5) Property protection insurance benefits consist of the lesser
of reasonable repair coats or replacement costs less depreciation
and, if applicable, the value of loss of use. However,
tection insurance benefits propertyy pro-
gible property arising from erac~dentoshaallgnot exceaed
$1,000,000.00.
History: Add. 1972, Act 294, Eff. Mar. 30, 1973;--Am. 1993, Act
290, Imd. Eff. Dec. 28, 1993.
500.3123 Ezcluaions frw property protection insurance benefits.
Sec. 3123. (1) Damage to the following kinds of property is
excluded from property protection insurance benefits:
37
(a) Vehicles and their contents, including trailers, operated or
designed for operation upon a public highway by power other than mus-
cular power, unless the vehicle is parked in a manner as not to cause
unreasonable risk of the damage which occurred.
insura ce p olic owthe by a person named in a property protection
p Y. person s spouse or a relative of either domi-
ciled in the same household, if the person named, the person's
spouse, or the relative was the owner, registrant, or operator of a
vehicle involved in the motor vehicle accident out of which the prop-
erty damage arose.
(2) Property protection insurance benefits are not payable for
property damage arising from motor vehicle accidents occurring out-
side the state.
(3) Property protection insurance benefits are not pa able for
property damage to utility transmission lines, wires, or cables aris-
eng from the failure of a municipality, utility company, or cable
television company to comply with the requirements of section 16 of
Act No. 368 of the Public Acts of 1925, being section 247.186 of the
Michigan Compiled Laws.
History: Add. 1972, Act 294,. Eff. Mar. 30, 1973;--Am. 1978, Act
65, Imd. Eff. Mar. 14, 1978.
500.3125 Priorities in claiaing property protection benefits.
Sec. 3125. A person suffering accidental property damage shall
claim property protection insurance benefits from insurers in the
following order of priority: insurers of owners or registrants of
vehicles involved in the accident; and insurers of operators of vehi-
cles involved in the accident.
History: Add. 1972, Act 294, Eff. Mar. 30, 1973.
500.3127 Distribution of loss, reiaburseeent, and indemnifiption
among property protection insurers.
Sec. 3127. The provisions for distribution of loss and for reim-
bursement and indemnification among personal protection insurers as
set forth in subsection (2) of section 3115 and in section 3116 also
applies to property protection insurers.
History: Add. 1972, Act 294, Eff. Mar. 30, 1973.
500.3131 Residual liability insurance; coverage.
Sec. 3131. (I) Residual liability insurance shall cover bodily
injury and property damage which occurs within the United States, its
territories and possessions, or in Canada. This insurance shall
afford coverage equivalent to that required as evidence of automobile
liability insurance under the financial responsibility laws of the
place in which the injury or damage occurs. In this state this insur-
ance shall afford coverage for automobile liability retained by sec-
tion 3135.
(2) This section shall not require coverage in this state other
than that required by section 3009(1). This section shall apply to
all insurance contracts in force as of October 1, 1973, or entered
into after that date.
38
History: Add. 1972, Act 294, Eff. Mar. 30, 1973;--Am. 1978, Act
460, Imd. Eff. Oct. 16, 1978,
XXOXX 500.3135 THIS SECTION IS AMENDED IF 1993 PA 143 IS
APPROVED BY A MAJORITY OF THE ELECTORS VOTING THEREON AT
THE NOVEMBER 8, 1994 GENERAL ELECTION: See
'mc1.00500.03135.amended XXOXX
500.3135 Tort liability for noneconomic loss; abolition of tort
liability; exceptions; action for damages; commencement of action;
removal; costs; decision as res judicata; effective date of sub-
sections (2)(d), (3), (4), and (5).
Sec. 3135. (I) A person remains subject to tort liability for non-
economic loss caused by his or her ownership, maintenance, or use of
a motor vehicle only if the injured person has suffered death, seri-
ous impairment of body function, or permanent serious disfigurement.
(2) Notwithstanding an~+ 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 sec-
tion 3101(3) and (4) 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 cer-
tain to be caused by his or her act or omission, the person does not
cause or suffer such harm intentionally if he or she acts or refrains
from acting for the purpose of averting injury to any person, includ-
ing himself or herself, or for the purpose of averting damage to tan-
gible property.
(b? Damages for noneconomic loss as provided and limited in sub-
section (1).
(c) Damages foz allowable expenses, work loss, and survivor's loss
as defined in sections 3107 to 3110 in excess of the daily,, monthly,
and 3-year limitations contained in those sections. The party liable
for damages is entitled to an exemption reducing his or her liability
by the amount of taxes that would have been payable on account of
income the injured person would have received if he or she had not
been injured.
(d) Damages up to $400.00 to motor vehicles, to the extent that
the damages are not covered by insurance. An action for damages pur-
suant to this subdivision shall be conducted in compliance with sub-
section (3).
(3) In an action for damages pursuant to subsection (2)(d):
(a) Damages shall be assessed on the basis of comparative fault,
except that damages shall not be assessed in favor of a party who is
more than SOi at fault.
(b) Liability shall not be a component of residual liability, as
prescribed in section 3131, for which maintenance of security is
required by this act.
(4) Actions under subsection (2)(d) shall be commenced, whenever
legally possible, in the small claims division of the district court
or the conciliation division of the common pleas court of the city of
Detroit or the municipal court. If the defendant or plaintiff removes
such an action to a higher court and does not prevail, the judge may
assess costa.
39
(5) A decision of a court made pursuant to subsection (2)(d),
shall not be res judicata in any proceeding to determine any other
liability arising from the same circumstances as gave rise to the
action brought pursuant to subsection (2)(d).
(6) Subsections (2)(d), (3), (4), and (5) shall take effect July
I, 1980.
History: Add. 1972, Act 294, Eff. Mar. 30, 1973;--Am. 1979, Act
145, Imd. Eff. Nov. 13, 1979;--Am. 1979, Act 147, Imd. Eff. Nov. 13,
1979.
XXXX 500.3135.amended THIS AMENDED SECTION IS NOT EFFECTIVE
UNLESS APPROVED BY A MAJORITY OF THE ELECTORS VOTING
TAEREON AT THE NOVEMBER 8, 1994 GENERAL ELECTION XXXX
500.3135 Tort liability of noneconomic loss; provisions applicable
to filing cause of action; abolition of tort liability; excep-
tions; action for damages; commencement of action; removal; mats;
decision as res judicata; powers of court relating to entry of
judgment.
Sec. 3135. (1) A person remains subject to tort liability for non-
economic loss caused by his or her ownership, maintenance, or use of
a motor vehicle only if the injured person has suffered death, seri-
ous impairment of body function, or permanent serious disfigurement.
(2) For a cause of action for damages pursuant to subsection (1)
filed on or after 120 days after the effective date of the amendatory
act that added this subsection, all of the following apply:
(a) The injured person shall not have suffered serious i~airment
of body function unless the person has suffered an objectively mani-
fested impairment of an important body function that affects his or
her general ability to lead his or her normal life. The issue of
whether an inured person has suffered serious impairment of body
function shall be a question of law for the court.
(b) Damages shall be assessed on the basis of comparative fault,
except that damages shall not be assessed in favor of a party who is
more than 50$ at fault.
(c) Damages shall not be assessed in favor of a party who was
operating his or her own vehicle at the time the damage occurred and
did not have in effect for the same motor vehicle involved in the
accident the security required by section 3101 at the time the damage
occurred.
~3) Notwithstanding any other provision of law, tort liability
arising from the ownership, maintenance, or use within this state of
a motor vehicle with respect to which the security required by sec-
tion 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 persona or property is substantially cer-
tain to be caused by his or her act or omission, the person does not
cause or suffer such harm intentionally if he or she acts or refrains
from acting for the purpose of averting injury to any person, includ-
ing himself or herself, or for the purpose of averting damage to tan-
gible property.
(b) Damages for noneconomic loss as provided and limited in
subsections (I) and (2).
40
(c) Damages for allowable expenses, work loss, and survivor's loss
as defined in sections 3107 to 3110 in excess of the daily, monthly,
and 3-year limitations contained in those sections. The party liable
for damages is entitled to an exemption ceducing 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 up to $500.00 to motor vehicles, to the extent that
the damages are not covered by insurance. An action for damages pur-
suant to this subdivision shall be conducted in compliance with sub-
section (4).
(4) In an action for damages pursuant to subsection (3)(d):
(a) Damages shall be assessed on the basis of comparative fault,
except that damages shall not be assessed in favor of a party who is
more than 503 at fault.
(b) Liability shall not be a component of residual liability, as
prescribed in section 3131, for which maintenance of security is
required by this act.
(5) Actions under subsection (3)(d) shall be commenced, whenever
legally possible, in the small claims division of the district court
or the municiQal court. If the defendant or plaintiff removes the
action to a higher court and does not prevail, the judge may assess
costs.
(6) A decision of a court made ppursuant to subsection (3)(d) shall
not be res judicata in any proceeding to determine any other liabil-
ity arising from the same circumstances as gave rise to the action
brought pursuant to subsection (3)(d).
(7) In an action for damages pursuant to subsection (1) or (3)(a)
filed on or after 120 days after the effective date of the amendatory
act that added this subsection:
(a) The court presiding over the action shall, after a jury ver-
dict, do 1 of the following within 21 days after entry of the
judgment:
(i) Concur in the award.
(ii) On its own motion or on the motion of any party, review the
excessiveness or inadequacy of the amount awarded and determine the
appropriate amount.
(b) In determining the excessiveness or inadequacy of the amount
awarded under subdivision (a)(ii), the court shall consider all of
the following factors:
(i) The evidence presented at trial.
(ii) Whether the amount awarded was within the limits of what rea-
sonable minds would consider just compensation for the injury and
damages sustained.
(isi) Whether the amount awarded is comparable to awards in simi-
lar cases within the state and in other jurisdictions.
41
(iv) Whether the amount awarded was the result of impcoper
methodds, prejudice, passion, partiality, sympathy, corruption, or
mistake of law or fact.
(c) If the court finds that the only error in the trial is the
inadequacy or excessiveness of the amount awarded, the court may
grant a new trial on the issue of the amount of damages only unless,
within 14 days, the parties consent in writing to the entry of a
judgment in an amount determined by the court.
History: Add. 1972, Act 294, Eff. Mar. 30, 1973;--Am. 1979, Act
145, Imd. Eff. Nov. 13, 1979;--Am. 1979, Act 147, Imd. Eff. Nov. 13,
1979;--Am. 1993, Act 143, Eff. (pending).
500.3141 Notice of accident.
Sec. 3141. An insurer may require written notice to be given as
soon as practicable after an accident involving a motor vehicle with
respect to which the policy affords the security required by this
chapter.
History: Add. 1972, Act 294, Eff. Mar. 30, 1973.
XXOXX 500.3142 THIS SECTION IS AMENDED IF 1993 PA 143 IS
APPROVED BY A MAJORITY OF THE ELECTORS VOTING THEREON AT
THE NOVEMBER 8, 1994 GENERAL ELECTION: See
'mc1.00500.03142.amended XXOXX
500.3142 Personal protection benefits payable as loss accrues;
overdue benefits.
Sec. 3142. (1) 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. if reasonable proof is not sup-
plied 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 be treated as made on the date a draft or other valid instru-
ment 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 12i
per annum.
History: Add. 1972, Act 294, Eff. Mar. 30, 1973.
XXXX 500.3142.amended THIS AMENDED SECTION IS NOT EFFECTIVE
UNLESS APPROVED BY A MAJORITY OF THE ELECTORS VOTING
THEREON AT THE NOVEMBER 8, 1994 GENERAL ELECTION XXXX
500.3142 Personal protection benefits payable as loss accrues;
overdue benefits; interest.
Sec. 3142. (1) Personal protection insurance benefits are payable
as loss accrues.
42
(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. If reasonable proof is not sup-
plied as to the entice 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 be treated as made on the date a draft or other valid instru-
ment 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 interest at the rate set by
section 6013(6) of the revised judicature act of 1961, Act No. 236 of
the Public Acts of 1961, being section 600.6013 of the Michigan
Compiled Laws. Interest paid .under this subsection shall be offset by
interest payable under section 6013(6) of Act No. 236 of the Public
Acts of 1961.
History: Add. 1972, Act 294, Eff. Mar. 30, 1973;--Am. 1993, Act
143, Eff. (pending).
500.3143 Assignsent of right to future benefits void.
Sec. 3143. An agreement for assignment of a right to benefits pay-
able in the future is void.
History: Add. 1972, Act 294, Eff. Mar. 30, 1973.
XXOXX 500.3195 THIS SECTION IS AMENDED IF 1993 PA 143 IS
APPROVED BY A MAJORITY OF THE ELECTORS VOTING THEREON AT
THE NOVEMBER 8, 1994 GENERAL ELECTION: See
'mc1.00500.03145.amended XXOXX
500.3145 Lititation of actions for rewvery of pEraonal or property
protection benefits; notice of injury.
Sec. 3145. (I) An action for recovery of personal protection
insurance benefits payable under this chapter for accidental bodily
injury may not be commenced later than 1 year after the date of the
accident causing the injury unless written notice of injury as pro-
vided herein has been given to the insurer within 1 year after the
accident or unless the insurer has previously made a payment of per-
sonal protection insurance benefits for the injury. If the notice has
been given or a payment has been made, the action ma be commenced at
any time within I year after the most recent allowable expense, work
loss or survivor's loss has been incurred. However, the claimant may
not recover benefits for any portion of the lose incurred more than 1
pear before the date on which the action was commenced. The notice of
injury required by this subsection may be given to the insurer or any
of its authorized agents by a person claimsng to be entitled to bene-
fits therefor, or by someone in his behalf. The notice shall give the
name and address of the claimant and indicate in ordinary language
the name of the person injured and the time, place and nature of his
injury.
(2) An action for recovery of property protection insurance bene-
fits shall not be commenced later than 1 year after the accident.
History: Add. 1972, Act 294, Eff. Mar. 30, 1973.
43
XXXX 500.3145.amended THIS AMENDED SECTION IS NOT EFFECTIVE
UNLESS APPROVED BY A MAJORITY OF THE ELECTORS VOTING
THEREON AT THE NOVEMBER 8, 1999 GENERAL ELECTION XXXX
500.3145 Actions for recovery of personal or property protection
benefits; limitation; notice of injury; commencement of action.
Sec. 3145. (1) Beginning 120 days after the effective date of the
amendatory act that added this subsection, an action for recovery of
insurance benefits payable under this chapter shall not be commenced
unless the claimant has appealed the denial of benefits through the
informal dispute resolution process described in section 3118 Any
statute of limitations period applicable to the recovery of insurance
benefits payable under this chapter excluding the period listed in
subsection (2) is tolled until the claimant has appealed the denial
of benefits through the informal dispute resolution process described
in section 3118.
(2) An action for recovery of personal protection insurance bene-
fits payable under this chapter for accidental bodily injury shall
not be commenced later than 1 year after the date of the accident
causing the injury unless written notice of in7'ury as provided herein
has been given to the insurer within 1 year after the accident caus-
ing the injury or unless the insurer has previously made a payment of
personal protection insurance benefits for the injury.
(3) if the notice has been given or a payment has been made under
subsection (2), the action ma be commenced at any time within I year
after the most recent allowable expense, work loss, or survivor's
loss has been incurred. However, the claimant may not recover bene-
fits for any portion of the lose incurred more than 1 year before the
date on which the action was commenced.
(4) The notice of injury required by subsection (2) may be given
to the insurer or any of its authorized agents by a person cleaning
to be entitled to benefits therefor, or by someone in his or her
behalf. The notice shall give the name and address of the claimant
and indicate in ordinary language the name of the person injured and
the time, place, and nature of his or her injury.
(5) An action for recovery of property protection insurance bene-
fits shall not be commenced later than 1 year after the accident.
History: Add. 1972, Act 294, Eff. Mar. 30, 1973;--Am. 1993, Act
143, Eff. (pending).
500.3146 Limitation of action by insurer for recovery or inde~ity.
Sec. 3146. An action by an insurer to enforce its rights of recov-
ery or indemnity under section 3116 mayy not be commenced later than 1
year after payymment has been received by a claimant upon a tort claim
with respect to which the insurer has a right of reimbursement or
recovery under section 3116.
History: Add. 1972, Act 294, Eff. Mar. 30, 1973.
500.3148 Attorney's fee.
Sec. 3148. (1) An attorney is entitled to a reasonable fee for
advising and representing a claimant in an action for personal or
property protection insurance benefits which are overdue. The
attorney's fee shall be a charge against the insurer in addition to
the benefits recovered, if the court finds that the insurer
44
unreasonably refused to pay the claim or unreasonably delayed in
making proper payment.
(2) An insurer may be allowed by a court an award of a reasonable
sum against a claimant as an attorney's fee for the insurer's attor-
ney in defense against a claim that was in some respect fraudulent or
so excessive as to have no reasonable foundation. 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 fee may be treated as
an offset against such benefits; also, judgment may be entered
against the claimant for any amount of a fee awarded against him and
not offset in this way or otherwise paid.
History: Add. 1972, Act 294, Eff. Mar. 30, 1973.
500.3151 Submission to mental or physical examination.
Sec. 3151. When the mental or physical condition of a person is
material to a claim that has been or may be made for past or future
personal protection insurance benefits, the person shall submit to
mental or physical examination by physicians. A personal protection
insurer may include reasonable provisions in a personal protection
insurance policy for mental and physical examination of persons
claiming personal protection insurance benefits.
History: Add. 1972, Act 294, Eff. Mar. 30, 1973.
500.3152 Report of mental or physical examination.
Sec. 3152. If requested by a person examined, a party causing an
examination to be made shall deliver to him a copy of every written
report concerning the examination rendered by an examining physician,
at least I of which reports shall set out his findings and conclu-
sions in detail. After such request and delivery, the party causing
the examination to be made is entitled upon request to receive from
the person examined every written report available to him or his rep-
resentative concerning any examination relevant to the claim, previ-
ously or thereafter made, of the same mental or physical condition,
and the names and addressee of physicians and medical care facilities
rendering diagnoses or treatment in regard to the injury or to a rel-
evant past injury, and shall authorize the insurer to inspect and
copy records of physicians, hospitals, clinics or other medical
facilities relevant to the claim. By requesting and obtaining a
report of the examination so ordered or by taking the deposition of
the examiner, the person examined waives any privilege he may have,
in relation to the claim for benefits, regarding the testimony of
every other person who has examined or may thereafter examine him in
respect of the same mental or physical condition.
History: Add. 1972, Act 294, Eff. Mar. 30, 1973.
500.3153 Court orders as to noncompliance with SS 500.3151 and
500.3152.
Sec. 3153. A court may make such orders in regard to the refusal
to comply with sections 3151 and 3152 as are just, except that an
order shall not be entered directing the arrest of a person for dis-
obeying an order to submit to a physical or mental examination. The
orders that may be made in regard to such a refusal include, but are
not limited to:
45
(a) An order that the mental or physical condition of the
disobedient person shall be taken to be established for the purposes
of the claim in accordance with the contention of the party obtaining
the order.
or(oppose designated) c aims ol~ defensesoboedip[oh~bitingthim from
introducing evidence of mental or physical condition.
(c) An order rendering judgment by default against the disobedient
person as to his entire claim or a designated part of it.
(d) An order requiring the disobedient person to reimburse the
insurer for reasonable attorneys' fees and expenses incurred in
defense against the claim.
(e~ An order requiring delivery of a report, in conformity with
section 3152, on such terms as are just, and if a physician fails or
refuses to make the report a court may exclude his testimony if
offered at trial.
History: Add. 1972, Act 294, Eff. Mar. 30, 1973.
XXOXX 500.3157 THIS SECTION IS AMENDED IF 1993 PA 143 IS
APPROVED BY A MAJORITY OF THE ELECTORS VOTING THEREON AT
THE NOVEMBER 8, 1994 GENERAL ELECTION: See
'mc1.00500.03157.amended XXOXX
500.3157 Charges for products, services, and aoco®odations where
treatment rendered.
Sec. 3157. A physician, hospital, clinic or other person or insti-
tution lawfully rendering treatment to an injured person for an acci-
dental bodily injury covered by personal protection insurance, and a
person or institution providing rehabilitative occupational training
following the injury, may charge a reasonable amount for the prod-
ucts, services and accommodations rendered. The charge shall not
exceed the amount the person or institution customarily charges for
like products, services and accommodations in cases not involving
insurance.
History: Add. 1972, Act 294, Eff. Mar. 30, 1973.
XXXX 500.3157.amended THIS AMENDED SECTION IS NOT EFFECTIVE
UNLESS APPROVED BY A MAJORITY OF THE ELECTORS VOTING
THEREON AT THE NOVEMBER 8, 1994 GENERAL ELECTION XXXX
500.3157 Charges for pproducts, services, and accassodations where
treataent rendered; limitation; rules establishing schedules of
fees; utilisation review systee; annual report; pro~tubition; rein
bursement as payaent in full; variances not precluded.
Sec. 3157. (1) Subject to subsections (2) and (3), a physician,
hospital, clinic, or other person or institution Ylaawfully rendering
treatment to an injured person for an accidental bodily injury cov-
ered by personal protection insurance, and a person or institution
providing rehabilitative occupational training following the injury,
ma charge a reasonable amount for the products, services, and accom-
modations rendered. The charge to an injured person or his or her
personal protection insurer shall not exceed the amount the person or
institution customarily charges and accepts as payment in full for
like products, services, and accommodations in cases not involving
personal protection insurance.
46
(2) By not later than 90 days after the effective date of the
amendatory act that added this subsection and continuing until a
schedule of fees is implemented pursuant to subsection (3), a physi-
cian, hospital, clinic, or other person or institution lawfully
rendering treatment to an injured person for an accidental bodily
injury covered bX personal protection insurance, and a person or
institution providing rehabilitative occupational training following
the injury are limited to, and shall be paid byy the automobile
insurer at, either of the following as selected by the provider:
(a) The amount paid for treatment, service, accommodation, and
medicine pursuant to payment under, or schedules of maximum fees for
worker s compensation contained in, R 418.101 to R 418.2324 of the
Michigan administrative code.
ingbhealthacarelfacilityfsccosts~tolits chargesafor theapriorlcalen-
dar year as used in the developrtient of reimbursement to that provider
by a payer authorized under the nonprofit health care corporation
reform act, Act No. 350 of the Public Acts of 1980, being
sections 550.1101 to 550.1704 of the Michigan Compiled Laws, multi-
plied by the prior calendar year s charges for specific automobile
accident injury treatments, services, accmmodations, and medicines.
For a health care provider, 110`& of the amount paid for treatment,
service, accommodation, and medicine pursuant to schedules of maximum
fees issued by a pa er authorized under Act No. 350 of the Public
Acts of 1980. For facilities in a provider class plan where con-
trolled charges are paid by a nonprofit health care corporation, con-
trolled charges shall also be paid by automobile insurers. This sub-
division shall not be interpreted as requiring a nonprofit health
care corporation to reveal any participating provider plans. Any
information needed for reimbursement under this subdivision shall
come from health care facilities and health care providers who elect
to be paid pursuant to this subdivision, pp
rules pTromulgmatedlbpethehadmin s trathvecprocuedures actsofu1969ntACt
No. 306 of the Public Acts of 1969, being sections 24.201 to 24.328
of the Michigan C®piled Laws, that a physician, hospital, clinic, or
other person or institution lawfully rendering treatment to an
injured person for an accidental bodily injury covered by personal
protection insurance and a person or institution providing rehabili-
tative occupational training following the injury shall be limited to
for reimbursement. The rules shall be submitted for a public hearing
b 21 months after the effective date of the amendatory act that
added this subsection. The ooamissioner shall provide for an advisory
committee to aid and assist the commissioner in establishing the
schedules of maximum fees under this subsection for any charges or
fees that are payable under this subsection. The advisory committee
shall be appointed by and serve at the pleasure of the co®isaioner.
(4) Unless an automobile insurer can demonstrate to the
bemcost1effectivet18eaaChlinsurer shalllim~pltlem~entealutilYzat~onlreview
s stem. A utilization review system shall be automated and include
all of the following:
(a) A provider enrollment file.
(b) Uniform claims forma.
(c) Uniform diagnosis and procedure code systems.
47
(d) Uniform place of service codes that indicate the setting where
the service was rendered.
(e) Uniform codes to identify other liable third party payers.
(f) Type of service codes.
(g) Quantification of the dollar amounts of all claims rejected to
and paid by other liable parties.
(h) A mechanism for identifying and rejecting claims that fail to
meet the requirements of the statute of limitations.
(i) A mechanism for identifying and rejecting nonaccident related
claims for review.
(5) Each automobile insurer shall report annually to the commis-
sioner in a form designated by the commissioner the results of its
utilization review system established under subsection (4). The
report shall include at a minimum the following information:
(a) The savings derived through coordination of benefits with
health care coverage carriers.
(b) The savings derived from identification of duplicate claims.
(c) The savings derived from identification of rejection of nonac-
cident related claims.
(d) All procedures identified as having been performed at facili-
ties not licensed for those procedures including the names of the
facilities involved.
(e) Number of claims and amounts expended, by type of medical and
rehabilitative and therapeutic services, for claims processed and
paid for the year.
(6) Automobile insurers shall not use a utilization review system
in bad faith oz to do either of the following:
(a) Unduly delay payment of legitimate claims.
(b) Harass or discriminate against medical providers or injured
automobile accident victims.
(7) A health care facility and health care provider shall accept
the amount reimbursed under subsections (2) and (3) as payment in
full.
(8) Nothing in this section requires a health care facility or
health care provider to accept a payment at a rate less than what is
provided for in subsections (2) and (3) and an insurer is not
required to pay more than the health care facility's or health care
provider's usual and customary charge.
(9) This act does not preclude health care facilities or health
care providers from contracting with insurers for reimbursement
levels that vary from those in this section.
History: Add. 1972, Act 294, Eff. Mar. 30, 1973;--Am. 1993, Act
143, Eff. (pending).
48
500.3158 Statement of earnings; report and records from medical
institution.
Sec. 3158. (I) An employer, when a request is made by a personal
protection insurer against whom a claim has been made, shall furnish
forthwith, in a form approved by the commissioner of insurance, a
sworn statement of the earnings since the time of the accidental
bodily injury and for a reasonable period before the injury, of the
person upon whose injury the claim is based.
(2) A physician, hospital, clinic or other medical institution
providing, before or after an accidental bodily injury upon which a
claim for personal protection insurance benefits is based, any prod-
uct, service or accommodation in relation to that or any other
injury, or in relation to a condition claimed to be connected with
that or any other injury, if requested to do so by the insurer
against whom the claim has been made, (a) shall furnish forthwith a
written report of the history, condition, treatment and dates and
costs of treatment of the injured person and (b) shall produce forth-
with and permit inspection and copying of its records regarding the
history, condition, treatment and dates and coats of treatment.
History: Add. 1972, Act 294, Eff. Mar. 30, 1973.
500.3159 Discovery.
Sec. 3159. In a dispute regarding an insurer's right to discovery
of facts about an injured person's earnings or about his history,
condition, treatment and dates and costa of treatment, a court may
enter an order for the discovery. The order may be made only on
motion for good cause shown and upon notice to all persona having an
interest, and shall specify the time, place, manner, wnditions and
scope of the discovery. A court, in order to protect against annoy-
ance, embarrassment or oppression, as justice requires, may enter an
order refusing discovery or specifying conditions of discovery and
may order payments of costs and eYpenaes of the proceeding, .including
reasonable fees for the appearance of attorneys at the proceedings,
as justice requires.
History: Add. 1972, Act 294, Eff. Mar. 30, 1973.
500.3163 Certification by admitted and nonadmitted insurers as to
protection of out-of-state resident; rights and issunitiea of
insurer and insureds.
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 bX an out-of-state resident who is insured
under iptse automobile liability insurance policies, shall be subject
thishact. sonal and property protection insurance system set forth in
(2) A nonadIDitted insurer may voluntarily file the certification
described in subsection (1).
(3) When a certification filed under subsections (I) or (2)
applies to accidental bodily injury or property damage, the insurer
and its insureds with respect to that in3ury or damage have the
rights and immunities under this act for personal and property
protection insureds, and claimants have the rights and benefits oy
49
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 Qroperty protection insurance applicable to
the accidental bodily injury or property damage.
History: Add. 1972, Act 294, Eff. Mar. 30, 1973.
Cited in other sections: Section 257.226 is cited in $ 257.226.
500.3171 Assigned claims facility and plan; organization and main-
tenance; participation; costs; rules.
Sec. 3171. The secretary of state shall organize and maintain an
assigned claims facility and plan. A self-insurer and insurer writing
insurance as provided by this chapter in this state shall participate
in the assigned claims plan. Costs incurred in the operation of the
facility and the plan shall be allocated fairly among insurers and
self-insurers. The secretary of state shall promulgate rules to
implement the facility and plan in accordance with and subject to Act
No. 306 of the Public Acts of 1969, as amended, being sections 24.201
to 24.315 of the Compiled Laws of 1948.
History: Add. 1972, Act 294, Eff. Mar. 30, 1973;--Am. 1972, Act
345, Imd. Eff. Jan. 9, 1973.
Administrative rules: R 11.101 et seq. of the Michigan
Administrative Code.
XXOXX 500.3172 THIS SECTION IS AMENDED IF 1993 PA 143 IS
APPROVED BY A MAJORITY OF THE ELECTORS VOTING THEREON AT
THE NOVEMBER 8, 1994 GENERAL ELECTION: See
'mc1.00500.03172.amended XXOXX
500.3172 Conditions to obtaining personal protection insurance ben-
efits through assigned claims plan; collection of unpaid benefits;
reimbursement from defaulting insurers; reduction of benefits;
applicability of subsection (2); definitions; effect of dispute
between insurers.
Sec. 3172. (I) A person entitled to claim because of accidental
bodily injury arising out of the ownership, operation, maintenance,
or use of a motor vehicle as a motor vehicle in this state ma obtain
personal protection insurance benefits through an assigned claims
plan if no personal protection insurance is applicable to the injuryy,
no personal protection insurance applicable to the injury can be
identified, the personal protection insurance applicable to the
injury cannot be ascertained because of a dispute between 2 or more
automobile insurers concerning their obligation to provide coverage
or the equitable distribution of the lose, or the only identifiable
personal protection insurance applicable to the injury is, because of
financial inability of 1 or more insurers to fulfill their obliga-
tions, inadequate to provide benefits up to the maximum prescribed.
In such case unpaid benefits due or caning due are subject to being
collected under the assigned claims plan, and the insurer to which
the claim is assigned, or the assigned claims facility if the claim
is assigned to it, is entitled to reimbursement from the defaulting
insurers to the extent of their financial responsibility.
(2i Except as otherwise provided in this subsection, personal pro-
tection insurance benefits, including benefits arising Fran accidents
occurring before the effective date of this subsection, payable
through an assigned claims plan shall be reduced to the extent that
benefits covering the same loss are available from other sources,
50
regardless of the nature or number of benefit sources available and
regardless of the nature or form of the benefits, to a person claim-
ing personal protection insurance benefits through the assigned
claims plan. This subsection shall only apply when the personal pro-
tection insurance benefits are payable through the assigned claims
flan because no personal protection insurance is applicable to the
injury, no personal protection insurance applicable to the injury can
be identified, or the only identifiable personal protection insurance
applicable to the injury is, because of financial inability of 1 or
more insurers to fulfill their obligations, inadequate to provide
benefits up to the maximum prescribed. As used in this subsection
"sources" and "benefit sources" do not include the program for medi-
cal assistance for the medically indigent under the social welfare
act, Act No. 280 of the Public Acts of 1939, being sections 400.1 to
400.121 of the Michigan Compiled haws, or insurance under the health
insurance for the aged act, title XVIiI of the social security amend-
ments of 1965.
(3) If the obligation to provide personal protection insurance
benefits cannot be ascertained because of a dispute between 2 or more
automobile insurers concerning their obligation to provide coverage
or the equitable distribution of the loss, and if a method of volun-
tary payment of benefits cannot be agreed upon among or between the
disputing insurers, all of the following shall apply:
(a) The insurers who are parties to the dispute shall, or the
claimant ma immediately notify the assigned claims facility of
their inability to determine their statutory obligations.
(b) The claim shall be assigned by the assigned claims facility to
an insurer which shall immediately provide personal protection insur-
ance benefits to the claimant or claimants entitled to benefits.
(c) An action shall be immediately commenced on behalf of the
assigned claims facility by the insurer to whom the claim is assigned
in circuit court for the purpose of declaring the rights and duties
of any interested party.
(d) The insurer to whom the claim is assigned shall join as par-
ties defendant each insurer disputing either the obligation to pro-
vide personal protection insurance benefits or the equitable distri-
bution of the loss among the insurers.
(e) The circuit court shall declare the rights and duties of any
interested party whether or not other relief is sought or could be
granted.
(f? After hearing the action, the circuit court shall determine
the insurer or insurers, if any, obligated to provide the applicable
personal protection insurance benefits and the equitable istribu-
tr`on, if any, among the insurers obligated therefor, and shall order
reimbursement to the assigned claims facility from the insurer or
insurers to the extent of the responsibility as determined by the
court. The reimbursement ordered under this subdivision shall include
all benefits and costa paid or incurred bX the assigned claims facil-
ity and all benefits and costs paid or incurred by insurers deter-
mined not to be obligated to provide applicable personal protection
insurance benefits, including reasonable attorney fees and interest
at the rate prescribed in section 3175 as of December 3t of the year
preceding the determination of the circuit court.
History: Add. 1972, Act 294, Eff. Mar. 30, 1973;--Am. 1972, Act
345, Imd. Eff. Jan. 9, 1973;-Am. 1984, Act 426, Eff. Mar. 29, 1985.
51
XXXX 500.3172,amended THIS AMENDED SECTION IS NOT EFFECTIVE
UNLESS APPROVED BY A MAJORITY OF THE ELECTORS VOTING
THEREON AT THE NOVEMBER 8, 1994 GENERAL ELECTION XXXX
500.3172 Conditions to obtaining personal protection insurance ben-
efits through assigned claims plan; collection of unpaid benefits;
reimbursement from defaulting insurers; reduction of benefits;
applicability of subsection (3); definitions; effect of dispute
between insurers; effect of unidentified or inadequate benefits;
benefits unavailable due to insolvent insurer.
Sec. 3172. (I) A person entitled to a claim because of accidental
bodily injury arising out of the ownership, operation, maintenance,
or use of a motor vehicle as a motor vehicle in this state ma obtain
personal protection insurance benefits through an assigned claims
plan in any of the following situations:
(a) If no personal protection insurance is applicable to the
injury.
(b) If no personal protection insurance applicable to the injury
can be identified.
(c) If the personal protection insurance applicable to the injury
cannot be ascertained because of a dispute between 2 or more automo-
bile insurers concerning their obligation to provide wverage or the
equitable distribution of the loss.
(d) If the only identifiable personal protection insurance appli-
cable to the in7'ury is, because of financial inability of I or more
insurers to fulfill their obligations, inadequate to provide benefits
up to the maximum prescribed.
(2) In any of the situations under subsection (1), unpaid benefits
due or coming due are subject to being collected under the assigned
claims plan, and the insurer to which the claim is assigned, or the
assigned claims facility if the claim is assigned to it, is entitled
to reimbursement from the defaulting insurers to the extent of their
financial responsibility.
(3) Except as otherwise provided in this subsection, personal pro-
tection insurance benefits, including benefits arising from accidents
occurring before the effective date of this subsection, payable
through an assigned claims plan shall be reduced to the extent that
benefits covering the same loss are available from other sources,
regardless of the nature or number of benefit sources available and
regardless of the nature or form of the benefits, to a person claim-
ing personal protection insurance benefits through the assigned
claims plan. This subsection only applies when the personal protec-
tion insurance benefits are payable through the assigned claims plan
because no personal Protection insurance is applicable to the injuryy,
no personal protection insurance applicable to the injury can be
identified, or the only identifiable personal protection insurance
applicable to the injury is, because of financial inability of I or
more insurers to fulfill their obligations, inadequate to provide
benefits up to the maximum prescribed. As used in this subsection
"sources" and "benefit sources" do not include the program for medi-
cal assistance for the medically indigent under the social welfare
act, Act No. 280 of the Public Acts of 1939, being sections 400.1 to
400.119b of the Michigan Caopiled Laws, or insurance under the health
insurance for the aged act, title XVIII of the social security amend-
ments of 1965.
52
(4) If the obligation to provide personal protection insurance
benefPits cannot be ascertained because of a dispute between 2 or more
automobile insurers concerning their obligation to provide coverage
or the equitable distribution of the loss, and if a method of volun-
tary payment of benefits cannot be agreed upon among or between the
disputing insurers, all of the following shall apply:
(a) The insurers who are patties to the dispute shall, or the
claimant ma , immediately notify the assigned claims facility of
their inability to determine their statutory obligations.
(b) The claim shall be assigned by the assigned claims facility to
an insurer which shall immediately provide personal protection insur-
ance benefits to the claimant or claimants entitled to benefits in
the highest amount applicable among the policies in dispute.
(c) An action shall be immediately commenced on behalf of the
assigned claims facility by the insurer to whom the claim is assigned
in circuit court for the purpose of declaring the rights and duties
of any interested party.
(d) The insurer to whom the claim is assigned shall join as par-
ties defendant each insurer disputing either the obligation to pro-
vide personal protection insurance benefits or the equitable distri-
bution of the loss among the insurers.
(e) The circuit court shall declare the rights and duties of any
interested party whether or not other relief is sought or could be
granted.
(f) After hearing the action, the circuit court shall determine
the insurer or insurers, if any, obligated to provide the applicable
ppersonal protection insurance benefits and the equitable istribu-
tion, if any, among the insurers obligated therefor, and shall order
reimbursement to the assigned claims facility from the insurer or
insurers to the extent of the responsibility as determined by the
court. The reimbursement ordered under this subdivision shall include
all benefits and costs paid or incurred bX the assigned claims facil-
ity and all benefits and costs paid or incurred by insurers deter-
mined not to be obligated to provide applicable personal protection
insurance benefits, including reasonable attorney fees and interest
at the rate prescribed in section 3175 as of December 31 of the year
preceding the determination of the circuit court.
(5) If no personal protection insurance is applicable to the
injury or no personal protection insurance applicable to the inJury
can be identified, personal protection insurance benefits shall be
paid only to the limit provided for in section 3107(1)(a)(t). If the
only identifiable personal protection insurance applicable to the
injury is, because of financial inability of 1 or more insurers to
fulfill their obligations, inadequate to provide benefits up to the
maximum prescribed, personal protection insurance benefits shall be
paid to the limit selected by the insured under section 3107(1)(a).
(6~ This section does not apply and section 3172a does apply if
applicable personal rotection insurance benefits are unavailable
because an insurer otherwise obliged to provide that coverage under
this chapter became, after October 1, 1993, an insolvent insurer as
defined r:n chapter 79.
History: Add. 1972, Act 294, Eff. Mar. 30, 1973;--Am. 1972, Act
345, Imd. Eff. Jan. 9, 1973;--Am. 1984, Act 426, Eff. Mar. 29,
1985;--Am. 1993, Act 143, Eff. (pending).
53
XXXX 500.3172a.added TBIS ADDED SECTION IS NOT EFFECTIVE
UNLESS APPROVED BY A MAJORITY OF THE ELECTORS VOTING
THEREON AT THE NOVEMBER 8, 1994 GENERAL ELECTION XXXX
500.3172a Michigan protection insurance berefits; conditions enti-
tling person to claim; priority of obligation.
Sec. 3172a. (1~ A person entitled to a claim because of accidental
bodily injury arising out of the ownership, operation, maintenance,
or use of a motor vehicle as a motor vehicle in this state may obtain
the full personal protection insurance benefits entitled through the
Michigan property and casualty guaranty association established under
chapter 79 if all of the following are satisfied:
(a) Personal protection insurance applicable to the injury is
unavailable because an insurer otherwise obliged to provide that cov-
erage under this chapter became, after October 1, 1993, an insolvent
insurer as defined in chapter 79.
(b~ Except as provided in subsection (2), the claim satisfies the
requirements of a covered claim under chapter 79.
(2) Notwithstanding section 7931(3), the obligation of the
Michigan property and casualty guaranty association under this sec-
tion shall be in the same priority as that of the insolvent insurer,
but for its insolvency, under sections 3114 and 3115.
History: Add. 1993, Act 143, Eff. (pending).
500.3173 Certain persons disqualified from receiving benefits under
assigned claims plans.
Sec. 3173. A person who because of a limitation or exclusion in
sections 3105 to 3116 is disqualified from receiving personal protec-
tion insurance benefits under a policy otherwise applxing to his
accidental bodily injure is also disqualified from receiving benefits
under the assigned claims plan.
History: Add. 1972, Act 294, Eff. Mar. 30, 1973.
5OO.3173a Eligibility for benefits; initial determination; denial;
notice.
Sec. 3173a. The assigned claims facility shall make an initial
determination of the claimant's eligibility for benefits under the
assigned claims plan and shall deny an obviously ineligible claim.
The claimant shall be notified promptly in writing of the denial and
the reasons for the denial.
History: Add. 1984, ACt 426, Eff. Mar. 29, 1985.
500.3174 Notice of claia through assigned claims plan; assiggment
of claim; notice to claimant; ooeaencement of action by cla><aant.
Sec. 3174. A person claiming through an assigned claims plan shall
notify the facility of his claim within the time that would have been
allowed for filing an action for Personal rotection insurance bene-
fits if identifiable coverage applicable ~o the claim had been in
effect. The facility shall promptly assign the claim in accordance
with the plan and notify the claimant of the identity and address of
the insurer to which the claim is assigned, or of the facility if the
claim is assigned to it. An action by the claimant shall not be
commenced more than 30 days after receipt of notice of the assignment
54
or the last date on which the action could have been commenced
against an insurer of identifiable coverage applicable to the claim,
whichever is later.
History: Add. 1972, ACt 294, Eff. Mar. 30, 1973;--Am. 1972, Act
345, Imd. Eff. Jan. 9, 1973.
500.3175 Rules for assignment of claims; duties of insurer to whom
claims assigned; compromises and settlements; rules; limitation on
action to enforce rights; interest on delinquent payments;
installment payments.
Sec. 3175. (1) The assignment of claims shall be made according to
rules that assure fair allocation of the burden of assigned claims
among insurers doing business in this state on a basis reasonably
related to the volume of automobile liability and personal protection
insurance they write on motor vehicles or of the number of
self-insured motor vehicles. An insurer to whom claims have been
assigned shall make prompt payment of loss in accordance with this
act and is thereupon entitled to reimbursement by the assigned claims
facility for the payments and the established loss adjustment cost,
together with an amount determined by use of the average annual
90-day United States treasury bill yield rate, as reported by the
council of economic advisers as of December 3t of the year for which
reimbursement is sought, as follows:
(a) For the calendar year in which claims are paid by the insurer,
the amount shall be determined by applying the specified annual yield
rate specified in this subsection to 1/2 of the total claims payments
and loss adjustment costs.
(b) For the period from the end of the calendar year in which
claims are paid by the insurer to the date payments for the operation
of the assigned claims facilityp and the assigned claims plan are due,
the amount will be determined by applying the annual yield rate spec-
ified in this subsection to the total claims payments and loss
adjustment costs multiplied by a fraction the denominator of which is
365 and the numerator of which is equal to the number of days that
have elapsed between the end of the calendar year and the date pa -
ments for the operation of the assigned claims facility and the
assigned claims plan are due.
(2) The insurer to whom claims have been assigned shall preserve
and enforce rights to indemnity or reimbursement against third par-
ties and account to the assigned claims facility therefor and shall
assign such rights to the assigned claims facility upon reimbursement
by the assigned claims facility. This section shall not preclude an
insurer from entering into reasonable compromises and settlements
with third parties against whom rights to indemnity or reimbursement
exist. The insurer shall account to the assigned claims facility for
such compromises and settlements. The rules promulgated under
section 3171 shall include a rule establishing reasonable standards
for enforcing rights to indemnity or reimbursanent against third par-
ties, including a standard establishing a value for such rights below
which actions to preserve and enforce the rights need not be pursued.
(3) An action to enforce rights to indemnity or reimbursement
against a third party shall not be commenced after the later of
2 years after the assignment of the claim to the insurer or 1 year
after the date of the last payment to the claimant.
55
(4) Payments for the operation of the assigned claims facility and
plan not paid by the due date shall bear interest at the rate of 208
per annum.
45) The secretary of state through the facility may enter into a
written agreement with the debtor permitting the payment of the judg-
ment or acknowledgment of debt in installments payable to the
facility.
History: Add. 1972, Act 294, Eff. Mar. 30, 1973;--Am. 1972, Act
345, Imd. Eff. Jan. 9, 1973;--Am. 1984, Act 426, Eff. Mar. 29, 1985.
500.3176 Taking costs into account in making and regulating rates.
Sec. 3176. Reasonable costs incurred in the handling and disposi-
tion of assigned claims, including amounts paid pursuant to assess-
ments under section 3171, shall be taken into account in making and
regulating rates for automobile liability and personal protection
insurance.
History: Add. 1972, Act 294, Eff. Mar. 30, 1973;--Am. 1972, Act
345, Imd. Eff. Jan. 9, 1973.
500.3177 Recovery by insurer of benefits and costs from owner or
re iatrant of uninsured motor vehicle; written agreement to pay
judgment in installments; notice.
Sec. 3177. (1) An insurer obligated to pay personal protection
insurance benefits for accidental bodily injury to a person arising
out of the ownership, maintenance, or use of an uninsured motor vehi-
cle as a motor vehicle may recover such benefits paid and appropriate
loss adjustment costs incurred from the owner or registrant of the
uninsured motor vehicle or from his or her estate. Failure of such a
person to make payment within 30 days after judc~nent is a ground for
suspension or revocation of his or her motor vehicle registration and
license as defined in section 25 of the Michigan vehicle code, Act
No. 300 of the Public Acts of 1949, being section 257.25 of the
Michigan Compiled Laws. An uninsured motor vehicle for the purpose of
this section is a motor vehicle with respect to which security is
required by sections 3101 and 3102 is not in effect at the time of
the accident.
(2) The motor vehicle registration and license shall not be sus-
pended or revoked and the motor vehicle registration and license
shall be restored if the debtor enters into a written agreement with
the secretary of state permitting the payment of the judgment in
installments, if the payment of any installments is not in default.
(3) The secretary of state upon receipt of a certified abstract of
court record of a judgment or notice from the insurer of an acknowl-
edgment of debt shall notify the owner or registrant of an uninsured
vehicle of the provisions of subsection (1) at that person's last
recorded address with the secretary of state and inform that person
of the right to enter into a written agreement with the secretary of
state for the payment of the judgment or debt in installments.
History: Add. 1972, Act 294, Eff. Mar. 30, 1973;--Am. 1984, Act
426, Eff. Mar. 29, 1985.
500.3179 Act applicable October 1, 1973.
Sec. 3179. This act applies to motor vehicle accidents occurring
on or after October I, 1973.
56
History: Add. 1972, Act 294, Eff. Mar. 30, 1973.
57
STATE vF MICHIGAN NO-FAULT INSURANCE LAW
GENERAL SUMMARY
Summary by
Edward 7, Andrade,
Legislative Assistant
February 13, 1995
1. Every owner of a motor vehicle must be insured for personal protection, property
protection and residual liability with minimum limits of $1,000,000.
2. Persons operating a motor vehicle without the required insurance protection are
guilty of a misdemeanor punishable with a fine of not less than $200 or greater
than $500, imprisonment for 1 year, or both.
3. Every in~~*M licensed to do business in this state must offer limits of $1 mil, $2
mil, $3 mil, $4 mil aad $5 mil.
4. Benefits for accidental bodily injury or damage are provided by the insurer
regardless of fault.
5. Tort liability arising from the ownership, maintenance, or use of a motor vehicle
is abolished.
Exceptions:
a) The injured person has suffered death, serious impairment of bodily function,
or permanent serious disfigurement (determination of this is a question of law for
the court).
b) The injury is intentional.
c) Damages are not covered by the insurance policy up to $500 (recovery shall be
done through small claims court).
6. Damages shall be assessed based on comparative fault, but not in favor of a
party who is more than 50% at fault.
7. Damages shall not be assessed in favor of a party who operates his own vehicle
without the required insurance protection.
8. Persons suffering a loss while not operating or an occupant of a motor vehicle
shall recover first from the insurer of the owner of the vehicle causing the injury
then from the insurer of the operator of the vehicle.
9. Charges for products, services, and accommodations where treatment is rendered
for an accidental bodily injury covered by personal protection incn*ance shall not
exceed the amount customarily charged for like products, services and
accommodations.
10. An insurer obligated to pay personal protection insurance benefits for accidental
bodily injury arising from the use of an uninsured motorist, may recover from
that nr,inm,red motorist or his estate.
11. Sets procedures were if an insured feels he is unfairly denied a claim by his
insurer, that denial shall be appealed to a managerial-level conference before
filing an action for recovery in the court.
12. Sets guidelines for a Catastrophic Claims Association where every insurer
engaging in writing in the state shall be a member and shall be assessed a
premium to cover expected losses. This Association shall indemnify each
member insurer for 100% of a loss in excess of $250,000.
13. Provides for a Personal Injury Protection task force, appointed by the
commissioner, who shall prepare a plan to reduce costs associated with auto
related injuries.