Groups in the state feel that the Michigan Catastrophic Claims Association is not adequately transparent.
The Michigan Catastrophic Claims Association (MCCA) fund is at the center of a considerable controversy when it comes to its transparency, and groups are now trying to boost the access to records with regards to the no-fault auto insurance system in the state.
That association is responsible for the assessment of the $186 fee per vehicle fee that is a component of the state’s system.
Groups are currently seeking to find a way to force the auto insurance industry as a whole, in the state, to open up their records. They have now made an appeal to the Michigan Supreme Court after they previously found themselves facing a barrier at the Michigan Court of Appeals level. The MCCA was first formed in 1978 by the Legislature. It is in control of a fund that currently holds over $17 billion and that is used for the reimbursement of insurers at times in which vehicle injury claims are greater than $530,000.
Motorists are required to make a payment as a part of their auto insurance to financially support that fund.
In January 2012, under the Michigan Freedom of Information Act (FOIA), the Coalition Protecting Auto No-Fault (CPAN) filed a lawsuit against the MCCA, stating that as it was created by the Legislature, the MCCA is a public body and, as such, its records should be subject to complete public scrutiny. The president of CPAN, John Cornack, explained that “We should have the right to examine whether it is charging appropriate rates to cover … costs.”
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In June 2012, a separate lawsuit was filed by the Brain Injury Association, when it received an MCAA rejection for its FOIA request. Those two lawsuits were later consolidated in order to create a single one.
According to the MCAA, it claims that it is specifically except from the regulations of the FOIA due to a state Insurance Code amendment, which states that “a record of an association or facility shall be exempt from disclosure.” In that amendment, an association or facility includes the definition of being “the catastrophic claims association.” Therefore, the auto insurance records remained exempted as there was concern that the MCCA’s operations could become “politicized” and that this would, in turn, threaten the fund’s stability.