HomeMy WebLinkAboutResolutions - 2013.05.22 - 20834MISCELLANEOUS RESOLUTION # 13145
BY: Commissioner Bob Hoffman, District #2
IN RE: BOARD OF COMMISSIONERS – SUPPORT FOR FULL FINANCIAL
TRANSPARENCY AND DISCLOSURE OF THE MICHIGAN CATASTROPHIC CLAIMS
ASSOCIATION FUNDS
To the Oakland County Board of Commissioners
Chairperson, Ladies and Gentlemen:
WHEREAS the Michigan Catastrophic Claims Association (MCCA), a private non-profit
unincorporated association, was created by the state Legislature in 1978; and
WHEREAS the MCCA was established by Public Act 136 of 1978, which amended the no-fault
law by adding Section 3104 effective July 1, 1978. The Legislature created MCCA because
insurance companies had difficulty obtaining reinsurance for Michigan's automobile no-fault
policies, which provided for unlimited lifetime medical benefits for people who are
catastrophically injured in auto accidents; and
WHEREAS under Michigan's No-Fault Law, the MCCA reimburses auto no-fault insurance
companies for each Personal Injury Protection (PIP) medical claim paid in excess of $500,000;
and
WHEREAS all auto insurance companies operating in Michigan are assessed to cover the
catastrophic medical claims occurring in Michigan. Those assessments are generally passed
on to auto insurance policyholders; and
WHEREAS the 2011-2012 assessment was $145.00 per vehicle. The 2012-2013 assessment is
currently $175.00 per vehicle; and
WHEREAS the MCCA assessment will rise to $186.00 per insured vehicle for the period July 1,
2013 to June 30, 2014; and
WHEREAS the MCCA reports that it paid out $947 million — more than $135 per insured car—
in 2012 for claim costs resulting from catastrophic injuries. The majority of these catastrophic
claims involves closed-head and spinal cord injuries, multiple fractures, and back and neck
injuries; and
WHEREAS this proposal represents an increase of $11.00 (6%) from the current MCCA charge
of $175.00 and represents $156.44 to cover anticipated new claims, $29.19 to address a $2
billion estimated deficit related to existing claims, and $0.37 for administrative expenses.
WHEREAS in 2012, MCCA has financial assets in excess of $14 billion.
WHEREAS MCCA as a fiduciary steward should be held to the highest standards of
transparency and accountability including:
• The full disclosure on how annual per vehicle assessment rates are calculated.
• Additional oversight through an annual independent audit, with the results of that audit
being reported to the Michigan State House and Michigan State Senate
• Requirement that decisions to raise rates are subject to the approval of the
Commissioner of the Office of Financial and Insurance Regulation and allowing for the
rejection of increases deemed to be excessive.
Chairperson, we move the adoption of the foregoing resolution.
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• That MCCA business be conducted at public meetings in compliance with Michigan's
"Open Meetings Act."
• And that MCCA documents be subject to the requirements of Michigan's Freedom of
Information Act.
NOW THEREFORE BE IT RESOLVED that the Oakland County Board of Commissioners,
hereby supports full disclosure and transparency of Michigan Catastrophic Claims Association
(MCCA) decisions.
BE IT FURTHER RESOLVED that the Oakland County Board of Commissioners hereby
supports the passage of Senate Bills 102 and 103 and urges the Michigan Legislature to adopt
and Governor Snyder to sign this legislation.
BE IT FURTHER RESOLVED that the Oakland County Clerk/Register of Deeds is requested to
forward copies of this adopted resolution to Governor Rick Snyder, Michigan Catastrophic
Claims Association (MCCA) Board of Directors and Executive Director, the Commissioner of
Financial and Insurance Regulation, Oakland County's delegation to the Michigan Legislature,
the Michigan Association of Counties, and Oakland County's lobbyists.
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Resolution #13145 May 22, 2013
The Chairperson referred the resolution to the General Government Committee. There were no
objections.