Whitmer, Duggan tout $400 auto insurance refunds; drivers warned about scams

Hani Barghouthi
The Detroit News

Detroit — Gov. Gretchen Whitmer reiterated Tuesday the promise that Michigan drivers would begin receiving $400 auto insurance refund checks this week, touting insurance savings for drivers following the 2019 auto no-fault insurance reform.  

Whitmer spoke at a press conference at the Jefferson Chevrolet dealership alongside Detroit Mayor Mike Duggan and Anita Fox, director of the Michigan Department of Insurance and Financial Services. They were joined by individual Michigan drivers who detailed what the refunds mean to them. 

Eligible consumers do not have to take any steps to receive the refund. Fox urged drivers to make sure their insurance companies had their latest address and bank information to facilitate the delivery of the refund. 

Gov. Gretchen Whitmer on Tuesday highlighted auto insurance refund checks, which could begin reaching drivers as soon as this week, at Jefferson Chevrolet in Detroit on Tuesday, March 8, 2022.

She cautioned against scammers who might call drivers and try to take advantage of the refunds.

"No one should be calling you about this refund for your personal information. If you do get a call, do not give out your name, your social security number, your address, nothing," Fox said. "If you believe it's possibly from your insurance company, hang up the phone, call your agent call your insurer."

The governor first announced Monday that refunds would be issued this week as the Michigan Catastrophic Claims Association planned to complete the transfer of $3 billion in surplus funds to state auto insurers. In November, the Democratic governor had called on the MCCA to refund state drivers along with lawmakers. 

In response to reporter questions, Whitmer said the refunds could help drivers offset the record-breaking costs of gas resulting from the war in Ukraine and economic sanctions on Russia.

"For too long, Michiganders in every county in every part of our state were paying too much for auto insurance," Whitmer said Tuesday. "It was money that could have been used to pay the bills or to put food on the table. And the high rates were unacceptable."

Duggan commended bipartisan collaboration in the Legislature for the 2019 reform, which he said was the reason there are 160,000 Michigan drivers insured today that were driving without insurance before. 

"It took years for us to fight to bring car insurance rates down," he said. "Michigan paid the highest in the country and Detroit paid the highest in Michigan, and the people who were benefiting from that fought back."

Every driver of a car, motorcycle or RV who was insured by 11:59 p.m. on Oct. 31 will be eligible for a direct refund, Fox said. 

The refunds will be issued by insurance companies to their clients after they receive the funds from the MCCA. That transfer was underway Tuesday, Fox said, and expected to be completed Wednesday. 

Insurers were directed to send drivers their money, via check or direct bank transfer, with an "absolute deadline" of May 9, she added. 

"Gift cards, premium discounts, credits against past or future balances will not be allowed," Fox said. 

Drivers should contact their insurance company if they do not receive their refund by the May 9 deadline and then contact DIFS if they cannot resolve the issue, Fox said.

Complaints and questions can be directed to michigan.gov/mccarefund or to the association's live call center 8 a.m.-5 p.m., Monday through Friday. The number is 833-ASK-DIFS (833-275-3437). 

At the press conference, Duggan introduced two Michigan residents who spoke about why the refund mattered to them. 

Karen Nash, a single mother of two boys, said she lived on a fixed income and was experiencing financial difficulties. The $400 refund, she said, will help her keep gas in her car so she can drive her 5-year-old son, Stevie, who was diagnosed with autism when he was 2, to physical therapy. 

Annie Holt, a longtime resident of Detroit, spoke about her premium rising steadily from $252 to $270 before the insurance reform, then dropping to $220.50 in July 2021. Holt said she will loan the refunded money to her granddaughter, who is enrolled in a physical therapy program. 

Duggan pushed back against criticism that no-fault auto insurance reform had cost victims of catastrophic crashes much of their home care because of a 45% fee cut to service providers.

Opponents of the 2019 insurance law say the slashed payments to medical providers have made it nearly impossible to care for clients, and have led to patients being discharged from home care programs to be sent to already crowded hospitals.

Legislation to alter the insurance reform was "not getting any traction with the Legislature" because, he said, service providers in Michigan that treated patients through auto insurance were reimbursed "triple" the rate paid to those with Blue Cross coverage. 

They were paid more than providers of similar services in Chicago, Pittsburgh and Columbus, Ohio, he said. 

"If I can help mediate a fair solution, I'm willing to do it," Duggan said. "But they need to be truthful with folks. They should get fair compensation for the very good care. They shouldn't get excessive pricing."

But Tom Judd, president of the Michigan Brain Injury Provider Council, said Duggan's comments on Blue Cross Blue Shield rates showed a misunderstanding of the issue. "Just as there are no payable Medicare codes for these services, commercial health also does not cover these services, so we are unsure as to what specifically the mayor is referencing," Judd said.

Health providers want to negotiate a "reasonable and narrow fix that would protect survivors and keep providers in business while maintaining cost-saving provisions that were included in auto insurance reform," he added. "The longer a fix is stonewalled, the more unnecessary suffering will occur.