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Steven Gursten
Steven Gursten
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Michigan Catastrophic Claims Fund (MCCA) fighting to keep financial workings under wraps

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MCCA is appealing the court ruling that says it is subject to the Freedom of Information Act

As our lawmakers and Gov. Rick Snyder continue to seek to “reform” Michigan’s No-Fault system, the insurance industry and government officials seek to keep the financial workings of the Michigan Catastrophic Claims Fund (MCCA) under wraps.

But common sense tells us that in order to reform anything, access to information is needed to make educated and informed decisions.

But not when it comes to the Michigan Catastrophic Claims Association (MCCA) fund — despite the fact that it's funded by Michigan drivers.

So the legal battle over access to financial information of the MCCA fund continues: the MCCA has recently appealed an Ingham County circuit court ruling that says the MCCA is subject to the Freedom of Information Act (FOIA) and must disclose how it calculates drivers’ yearly assessment fee.

What is the MCCA? It's a private, nonprofit association made up of a five-person board (actually five executives from the insurance industry). The board manages the MCCA fund, which compensates auto insurance companies when an auto No-Fault claim exceeds $500,000.

Most accident victims who turn to the MCCA fund have brain injuries and spinal cord injuries and are disabled for life. They rely on lifetime medical benefits and attendant care provided by the Michigan No-Fault law to survive.

The MCCA meetings are closed to the public. And the amount of money in the fund until the recent Ingham County ruling was kept secret from the public too.

But the MCCA should not operate in greater secrecy than the Central Intelligence Agency. Somehow we’ve allowed this to happen. It would be a big No Fault reform if Governor Snyder came out on the issue of the MCCA having to open its books to the public. In the meantime, it’s clear that the big insurers who make up the MCCA board are going to do everything they can to try to keep its financials and business decisions as hush-hush as they can. And that means keeping Michigan drivers in the dark.

There is also a glaring conflict of interest here. This is all happening at the same time that the same insurance companies who sit on the MCCA board are also pushing hard to “reform” No-Fault by taking away vital protections from the most injured and most in need. Having an accurate assessment of where the MCCA really stands now would certainly help in making the right decisions.

As I've said many times before, Michigan has some of the highest auto insurance rates in the country. A contributing factor is the annual per-vehicle assessment rate for drivers that's charged by the MCCA. These charges (and large increases in charges, such as 21% in 2012), have been made by the MCCA board in complete confidentiality. Many have speculated that some of these increases, including the staggering increase in 2012, were politically motivated by insurance company reform efforts to change Michigan’s No Fault laws.

MCCA disclosure would surely shed needed light on this as well.

Michigan drivers, who are required by law to pay into the MCCA, have the right to know the facts — especially how the MCCA comes up with its annual $175 per vehicle fee and how much is in the fund.

Related information:

The auto insurance industry's coup de'tat of the Michigan Assigned Claims Plan