NO-FAULT RETENTION LIMIT INCREASE - S.B. 199: FLOOR ANALYSIS
Senate Bill 199 (as reported without amendment)
Sponsor: Senator Joanne G. Emmons
Committee: Financial Services
CONTENT
The bill would amend Chapter 31 (Motor Vehicle Personal and Property Protection) of the Insurance Code to provide for increases in no-fault insurers' retention limit, beyond which the Michigan Catastrophic Claims Association (MCCA) provides indemnification. Under the bill, the MCCA would have to provide and each member would have to accept indemnification for 100% of the amount of ultimate loss sustained under personal protection insurance coverages in the following amounts, for a motor vehicle accident policy issued or renewed during the following periods:
| Amount | Period |
| $250,000 | Before July 1, 2002 |
| $300,000 | July 1, 2002, to June 30, 2003 |
| $325,000 | July 1, 2003, to June 30, 2004 |
| $350,000 | July 1, 2004, to June 30, 2005 |
| $375,000 | July 1, 2005, to June 30, 2006 |
| $400,000 | July 1, 2006, to June 30, 2007 |
| $420,000 | July 1, 2007, to June 30, 2008 |
| $440,000 | July 1, 2008, to June 30, 2009 |
| $460,000 | July 1, 2009, to June 30, 2010 |
| $480,000 | July 1, 2010, to June 30, 2011 |
| $500,000 | July 1, 2011, to June 30, 2013 |
Beginning July 1, 2013, the $500,000 amount would have to be increased biennially on July 1 of the following odd-numbered year, by the lesser of 6% or the consumer price index, and rounded to the nearest $5,000. The MCCA would have to calculate the biennial adjustment by January 1 of the year of its July 1 effective date.
Currently, each no-fault insurer must be a member of the MCCA. The MCCA must provide and each member must accept indemnification for 100% of the amount of ultimate loss sustained under personal protection insurance coverages in excess of $250,000 in each occurrence.
The bill would take effect July 1, 2002.
MCL 500.3104 - Legislative Analyst: L. Arasim
FISCAL IMPACT
The bill would have no fiscal impact on State or local government.
Date Completed: 2-14-01 - Fiscal Analyst: M. TyszkiewiczFloor\sb199 - Bill Analysis @ http://www.senate.state.mi.us/sfa
This analysis was prepared by nonpartisan Senate staff for use by the Senate in its deliberations and does not constitute an official statement of legislative intent.