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Is MACP violating auto accident victims’ No Fault rights?

Michigan Assigned Claims Plan is re-writing our No Fault law, forcing uninsured auto accident victims to comply with rules neither approved nor authorized by Legislature

MACP rewrites MI No Fault law

If the Michigan Assigned Claims Plan (MACP) decides to violate the constitution, but no one writes or talks about it, do they get away with it? The No Fault rights of thousands of uninsured auto accident victims are in the balance, after the MACP’s unilateral rewriting of the No Fault law.

And all without legislative approval.

Instead of applying the rules clearly set forth in the No Fault Law, the MACP took the law into its own hands and created new requirements, new burdens of proof and a new eligibility standard for uninsured auto accident victims seeking No Fault benefits through the MACP. To learn more, take a look at my blog post from Thursday, “MACP seizes ‘legislative power’ to rewrite No Fault Law.”

The MACP is an unelected organization that’s run by the for-profit auto insurance company-dominated Board of Governors of the Michigan Auto Insurance Placement Facility (MAIPF). The MACP administers a safety net of insurance coverage for No Fault benefits in situations where a person is involved in a car accident, but there is no insurance company available to provide no-fault benefits.

This is a very big deal. To the extent uninsured auto accident victims were forced to comply with – and/or had their No Fault insurance claims denied as a result of – the MACP’s new rules, the MACP violated the No Fault law and the rights of the victims who came to the MACP for help.

Just how many uninsured people will these new MACP rules affect?

Although claims figures for 2014 haven’t yet been released to the public, in 2013, 3,399 uninsured auto accident victims sought No Fault benefits through the MACP, according to written testimony submitted to the Michigan House of Representatives’ Insurance Committee on May 22, 2014.

No Fault Law’s eligibility standard for MACP

Uninsured auto accident victims in Michigan have a right under the No Fault law to collect No Fault benefits through the MACP so long as their claims are not “obviously ineligible.” (See MCL 500.3171; 500.3172; 500.3173a and 500.3174)

New rules unilaterally created by the MACP

Under the MACP’s unilaterally-created rules, an uninsured auto accident victim must run the following gauntlet of rules, burdens of proof and legal requirements if he hopes to have any chance of collecting No Fault benefits:

  • An auto accident victim must provide a “satisfactory proof of loss” that the Michigan Auto Insurance Placement Facility (MAIPF), which is controlled by the seven for-profit auto insurers that control the MACP, “deems satisfactory to substantiate that the claimant may be entitled to benefits through the MACP.”
  • An auto accident victim must prove she exercised “[d]ue diligence” in “investigat[ing] and exhaust[ing] all avenues of any other available coverage. This may include, but is not limited to, contact attempt with the claimant, the claimant’s resident relatives or spouse, the involved vehicle owner(s), the involved vehicle driver and any other actions that the MAIPF deems necessary for the claimant or their representative to determine that the claimant may be entitled to benefits through the MACP.”
  • An auto accident victim can be required to submit to “an examination” by an insurance company doctor “under oath.”

In 2012, the Michigan Legislature made amendments to the “assigned claims plan” provisions of the No Fault.

Significantly, no changes were made to the eligibility standard discussed above (i.e., uninsured auto accident victims in Michigan have a right under the No Fault law to collect No Fault benefits through the MACP so long as their claims are not “obviously ineligible.”)

Additionally, no changes were made to the “Plan of Operations” provision, MCL 500.3171(5), that would allow the MACP to unilaterally – and without the Legislature’s approval and authorization – rewrite the No Fault Law and/or create its own rogue set of No Fault rules.

When did MACP “go rogue?”

It’s not exactly clear when exactly the MACP unilaterally rewrote the No Fault Law and began applying its rogue set of rules to uninsured auto accident victims seeking No Fault benefits through the MACP.

What is clear is that it definitely occurred after the 2012 amendments, which shifted control over the MACP from the publicly elected Secretary of State to the for-profit insurance company-dominated Board of Governors for the Michigan Auto Insurance Placement Facility (MAIPF).

The MACP’s Plan of Operations, which was created by the MAIPF’s Board of Governors (of which seven of the 11 members are for-profit auto insurance companies) and approved by the Insurance Commissioner (Director of the Michigan Department of Insurance and Financial Services (DIFS), suggests the MACP rogue set of rules took effect on January 1, 2013.

That’s the date specified in the MACP’s Plan of Operations when control over the MACP officially shifted from the Secretary of State to the MAIPF’s Board of Governors with its insurance-company super-majority. (See “Plan of Operations,” Section 1.1 “Effective Date/Transition”)

Alternatively, the MACP’s rogue set of No Fault rules could’ve taken effect on January 24, 2014, which is the date of the MACP’s “Report to the Director of the Department of Insurance and Financial Services.”

Or the effective date could be May 22, 2014, when the General Manager of the MAIPF presented the MACP’s report to the Michigan House of Representative’s Insurance Committee.

The problem is no one really knows or can easily find out.  All of these maneuvers were enacted and implemented without any public disclosures.

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Blog Author Steven M. Gursten
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