HOUSE BILL No. 6099

 

December 18, 2014, Introduced by Rep. Hovey-Wright and referred to the Committee on Insurance.

 

     A bill to amend 1956 PA 218, entitled

 

"The insurance code of 1956,"

 

by amending the title, the heading of chapter 61, and sections 102,

 

3116, 3301, 3330, 4501, 6101, 6105, 6107, 6110, and 6111 (MCL

 

500.102, 500.3116, 500.3301, 500.3330, 500.4501, 500.6101,

 

500.6105, 500.6107, 500.6110, and 500.6111), the title as amended

 

by 2002 PA 304, section 102 as amended by 2000 PA 252, section 3330

 

as amended by 2012 PA 204, section 4501 as amended by 2012 PA 39,

 

sections 6101, 6105, 6107, and 6110 as added by 1992 PA 174, and

 

section 6111 as amended by 2004 PA 316, and by adding sections

 

6104, 6104a, 6104b, and 6108; and to repeal acts and parts of acts.

 

THE PEOPLE OF THE STATE OF MICHIGAN ENACT:

 

                                TITLE


 

     An act to revise, consolidate, and classify the laws relating

 

to the insurance and surety business; to regulate the incorporation

 

or formation of domestic insurance and surety companies and

 

associations and the admission of foreign and alien companies and

 

associations; to provide their rights, powers, and immunities and

 

to prescribe the conditions on which companies and associations

 

organized, existing, or authorized under this act may exercise

 

their powers; to provide the rights, powers, and immunities and to

 

prescribe the conditions on which other persons, firms,

 

corporations, associations, risk retention groups, and purchasing

 

groups engaged in an insurance or surety business may exercise

 

their powers; to provide for the imposition of a privilege fee on

 

domestic insurance companies and associations; and the state

 

accident fund; to provide for the imposition of a tax on the

 

business of foreign and alien companies and associations; to

 

provide for the imposition of a tax on risk retention groups and

 

purchasing groups; to provide for the imposition of a tax on the

 

business of surplus line agents; to provide for the imposition of

 

regulatory fees on certain insurers; to provide for assessment fees

 

on certain health maintenance organizations; to modify tort

 

liability arising out of certain accidents; to provide for limited

 

actions with respect to that modified tort liability and to

 

prescribe certain procedures for maintaining those actions; to

 

proscribe the reimbursement or payment of certain benefits from

 

recoveries for claims in tort or contract; to require security for

 

losses arising out of certain accidents; to provide for the

 

continued availability and affordability of automobile insurance


 

and homeowners insurance in this state and to facilitate the

 

purchase of that insurance by all residents of this state at fair

 

and reasonable rates; to provide for certain reporting with respect

 

to insurance and with respect to certain claims against uninsured

 

or self-insured persons; to prescribe duties for certain state

 

departments and officers with respect to that reporting; to provide

 

for certain assessments; to establish and continue certain state

 

insurance funds; to modify and clarify the status, rights, powers,

 

duties, and operations of the nonprofit malpractice insurance fund;

 

to provide for the departmental supervision and regulation of the

 

insurance and surety business within this state; to provide for

 

regulation over of worker's compensation self-insurers; to provide

 

for the conservation, rehabilitation, or liquidation of unsound or

 

insolvent insurers; to provide for the protection of policyholders,

 

claimants, and creditors of unsound or insolvent insurers; to

 

provide for associations of insurers to protect policyholders and

 

claimants in the event of insurer insolvencies; to prescribe

 

educational requirements for insurance agents and solicitors; to

 

provide for the regulation of multiple employer welfare

 

arrangements; to create an automobile insurance fraud and theft

 

prevention authority to reduce insurance fraud and the number of

 

automobile thefts in this state; to prescribe the powers and duties

 

of the automobile insurance fraud and theft prevention authority;

 

to provide certain powers and duties upon certain officials,

 

departments, and authorities of this state; to provide for an

 

appropriation; to repeal acts and parts of acts; and to provide

 

penalties for the violation of this act.


 

     Sec. 102. As used in this act:

 

     (a) (1) "Commissioner" as used in this act means the

 

commissioner of the office of financial and insurance

 

services.director.

 

     (b) (2) "Department" as used in this act means the office

 

department of financial and insurance and financial services.

 

     (c) "Director" means the director of the department.

 

     (d) "Office of financial and insurance regulation" and "office

 

of financial and insurance services" mean the department.

 

     Sec. 3116. (1) A subtraction from personal protection

 

insurance benefits shall not be made because of the value of a

 

claim in tort based on the same accidental bodily injury. A

 

subtraction or reimbursement from a claim in tort or contract shall

 

not be made for personal protection insurance benefits, other

 

health and accident coverage, or benefits provided or required to

 

be provided under the laws of any state or the United States,

 

whether paid or payable, except as set forth in subsection (2).

 

     (2) A subtraction from or reimbursement for personal

 

protection insurance benefits, other health and accident coverage,

 

or benefits provided or required to be provided under the laws of

 

any state or the United States, whether paid or payable, under this

 

chapter shall be made only if recovery is realized upon a tort

 

claim arising from an accident occurring outside this state, a tort

 

claim brought within this state against the owner or operator of a

 

motor vehicle with respect to which the security required by

 

section 3101 (3) 3101(3) and (4) was not in effect, or a tort claim

 

brought within this state based on intentionally caused harm to


 

persons or property, and shall be made only to the extent that the

 

recovery realized by the claimant is for damages for which the

 

claimant has received or would otherwise be entitled to receive

 

personal protection insurance benefits. A subtraction shall be made

 

only to the extent of the recovery, exclusive of reasonable

 

attorneys' attorney fees and other reasonable expenses incurred in

 

effecting the recovery. If personal protection insurance benefits

 

have already been received, the claimant shall repay to the

 

insurers out of the recovery a sum an amount equal to the benefits

 

received, but not more than the recovery exclusive of reasonable

 

attorneys' attorney fees and other reasonable expenses incurred in

 

effecting the recovery. The insurer shall have has a lien on the

 

recovery to this extent. A recovery by an injured person or his or

 

her estate for loss suffered by the person shall not be subtracted

 

in calculating benefits due a dependent after the death and a

 

recovery by a dependent for loss suffered by the dependent after

 

the death shall not be subtracted in calculating benefits due the

 

injured person.

 

     (3) A personal protection insurer with a right of

 

reimbursement under subsection (1), (2), if suffering loss from

 

inability to collect reimbursement out of a payment received by a

 

claimant upon a tort claim, is entitled to indemnity from a person

 

who, with notice of the insurer's interest, made the payment to the

 

claimant without making the claimant and the insurer joint payees

 

as according to their interests may appear or without obtaining the

 

insurer's consent to a different method of payment.

 

     (4) A claimant's insurer, plan, or governmental entity is not


 

entitled to a subtraction or reimbursement shall not be due the

 

claimant's insurer from that portion of any a recovery to the

 

extent that the recovery is realized for noneconomic loss as

 

provided in section 3135(1) and (2)(b) or for allowable expenses,

 

work loss, and survivor's loss as defined in sections 3107 to 3110

 

in excess of the amount recovered by the claimant from his or her

 

insurer.

 

     (5) An insurer, plan, or governmental entity that is not

 

subject to subsections (1) to (4) and that is entitled by law or

 

contract to subrogation or reimbursement of benefits paid or

 

payable from a claim in tort or contract arising out of bodily

 

injury is entitled to subrogation or reimbursement only to the

 

extent of the net recovery in tort or contract. If payment of a

 

claim of subrogation or reimbursement would result in the claimant

 

in tort or contract receiving less from the net recovery of the

 

claim than the insurer, plan, or governmental entity, the insurer,

 

plan, or governmental entity and the claimant in tort or contract

 

shall share the net recovery equally. If a claimant in tort or

 

contract must reimburse an insurer, plan, or governmental entity,

 

the insurer responsible for paying the claimant's personal

 

protection insurance benefits under this chapter shall reimburse

 

the claimant for the reimbursement. As used in this subsection,

 

"net recovery" means the total settlement or judgment exclusive of

 

reasonable attorney fees and other reasonable expenses incurred in

 

effecting the recovery.

 

     Sec. 3301. (1) Every insurer authorized to write automobile

 

insurance in this state shall participate in an organization for


 

the purpose of doing all of the following:

 

     (a) Providing the guarantee that automobile insurance coverage

 

will be available to any person who is unable to procure that

 

insurance through ordinary methods.

 

     (b) Preserving to the public the benefits of price competition

 

by encouraging maximum use of the normal private insurance system.

 

     (c) Providing funding for the Michigan automobile insurance

 

fraud and theft prevention authority.

 

     (2) The organization created under this chapter shall be

 

called the "Michigan automobile insurance placement facility".

 

     Sec. 3330. (1) The board of governors has the power to direct

 

the operation of the facility, including, at a minimum, the power

 

to do all of the following:

 

     (a) To sue and be sued in the name of the facility. A judgment

 

against the facility shall does not create any liabilities in the

 

individual participating members of the facility.

 

     (b) To delegate ministerial duties, to hire a manager, to hire

 

legal counsel, and to contract for goods and services from others.

 

     (c) To assess participating members on the basis of

 

participation ratios pursuant to section 3303 to cover anticipated

 

costs of operation and administration of the facility, to provide

 

for equitable servicing fees, and to share losses, profits, and

 

expenses pursuant to the plan of operation.

 

     (d) To impose limitations on cancellation or nonrenewal by

 

participating members of facility-placed business, in addition to

 

the limitations imposed by chapters 21 and 32.

 

     (e) To provide for a limited number of participating members


 

to receive equitable distribution of applicants; or to provide for

 

a limited number of participating members to service applicants in

 

a plan of sharing of losses in accordance with section 3320(1)(c)

 

and the plan of operation.

 

     (f) To provide for standards of performance of service for the

 

participating members designated under subdivision (e).

 

     (g) To adopt a plan of operation and any amendments to the

 

plan, consistent with this chapter, necessary to assure the fair,

 

reasonable, equitable, and nondiscriminatory manner of

 

administering the facility, including compliance with chapter 21,

 

and to provide for any other matters necessary or advisable to

 

implement this chapter, including matters necessary to comply with

 

the requirements of chapter 21.

 

     (h) To assess self-insurers and insurers consistent with

 

chapter 31 and the assigned claims plan approved under section

 

3171.

 

     (i) To annually assess participating members and self-insurers

 

an aggregate amount not to exceed an amount calculated by the board

 

to reasonably cover anticipated costs of operation and

 

administration of the Michigan automobile insurance fraud and theft

 

prevention authority.

 

     (2) The board of governors shall institute or cause to be

 

instituted by the facility or on its behalf an automatic data

 

processing system for recording and compiling data relative to

 

individuals insured through the facility. An automatic data

 

processing system established under this subsection shall, to the

 

greatest extent possible, be made compatible with the automatic


 

data processing system maintained by the secretary of state, to

 

provide for the identification and review of individuals insured

 

through the facility.

 

     (3) On or before January 1, 2016, the board of governors shall

 

amend the plan of operation to establish appropriate procedures

 

necessary to make assessments for and to carry out the

 

administrative duties and functions of the Michigan automobile

 

insurance fraud and theft prevention authority as provided in

 

chapter 61.

 

     Sec. 4501. As used in this chapter:

 

     (a) "Authorized agency" means the department of state police;

 

a city, village, or township police department; a county sheriff's

 

department; a United States criminal investigative department or

 

agency; the prosecuting authority of a city, village, township,

 

county, or state or of the United States; the office of financial

 

and insurance regulation; department; the Michigan automobile

 

insurance fraud and theft prevention authority; or the department

 

of state.

 

     (b) "Financial loss" includes, but is not limited to, loss of

 

earnings, out-of-pocket and other expenses, repair and replacement

 

costs, investigative costs, and claims payments.

 

     (c) "Insurance policy" or "policy" means an insurance policy,

 

benefit contract of a self-funded plan, health maintenance

 

organization contract, nonprofit dental care corporation

 

certificate, or health care corporation certificate.

 

     (d) "Insurer" means a property-casualty insurer, life insurer,

 

third party administrator, self-funded plan, health insurer, health


 

maintenance organization, nonprofit dental care corporation, health

 

care corporation, reinsurer, or any other entity regulated by the

 

insurance laws of this state and providing any form of insurance.

 

     (e) "Michigan automobile insurance fraud and theft prevention

 

authority" means the Michigan automobile insurance fraud and theft

 

prevention authority created under section 6104.

 

     (f) (e) "Organization" means an organization or internal

 

department of an insurer established to detect and prevent

 

insurance fraud.

 

     (g) (f) "Person" includes an individual, insurer, company,

 

association, organization, Lloyds, society, reciprocal or inter-

 

insurance exchange, partnership, syndicate, business trust,

 

corporation, and any other legal entity.

 

     (h) (g) "Practitioner" means a licensee of this state

 

authorized to practice medicine and surgery, psychology,

 

chiropractic, or law, any other licensee of the state, or an

 

unlicensed health care provider whose services are compensated,

 

directly or indirectly, by insurance proceeds, or a licensee

 

similarly licensed in other states and nations, or the practitioner

 

of any nonmedical treatment rendered in accordance with a

 

recognized religious method of healing.

 

     (i) (h) "Runner", "capper", or "steerer" means a person who

 

receives a pecuniary or other benefit from a practitioner, whether

 

directly or indirectly, for procuring or attempting to procure a

 

client, patient, or customer at the direction or request of, or in

 

cooperation with, a practitioner whose intent is to obtain benefits

 

under a contract of insurance or to assert a claim against an


 

insured or an insurer for providing services to the client,

 

patient, or customer. Runner, capper, or steerer does not include a

 

practitioner who procures clients, patients, or customers through

 

the use of public media.

 

     (j) (i) "Statement" includes, but is not limited to, any

 

notice statement, proof of loss, bill of lading, receipt for

 

payment, invoice, account, estimate of property damages, bill for

 

services, claim form, diagnosis, prescription, hospital or doctor

 

record, X-rays, test result, or other evidence of loss, injury, or

 

expense.

 

CHAPTER 61

 

AUTOMOBILE INSURANCE FRAUD AND THEFT PREVENTION AUTHORITY

 

     Sec. 6101. As used in this chapter:

 

     (a) "Authority" means the automobile theft prevention

 

authority Michigan automobile insurance fraud and theft prevention

 

authority.

 

     (b) "Automobile insurance fraud" means a fraudulent insurance

 

act as described in section 4503 that is committed in connection

 

with an application for or a policy of automobile insurance.

 

     (c) (b) "Board" means the board of directors of the Michigan

 

automobile insurance fraud and theft prevention authority.

 

     (c) "Economic automobile theft" means automobile theft

 

perpetrated for financial gain.

 

     (d) "Car years" means net direct private passenger and

 

commercial nonfleet vehicle years of insurance providing the

 

security required by section 3101(1) written in this state for the

 

calendar year ending the December 31 of the second prior year as


 

reported to the statistical agent of each insurer.

 

     (e) "Facility" means the Michigan automobile insurance

 

placement facility created under chapter 33.

 

     Sec. 6104. (1) Beginning January 1, 2016, the Michigan

 

automobile insurance fraud and theft prevention authority is

 

created within the facility. The facility shall provide staff for

 

the authority and shall carry out the administrative duties and

 

functions as directed by the board.

 

     (2) The authority is not a state agency, and the money of the

 

authority is not state money. However, both of the following apply

 

to the authority:

 

     (a) A record of the authority is subject to disclosure as if

 

it were a public record under the freedom of information act, 1976

 

PA 442, MCL 15.231 to 15.246.

 

     (b) The authority shall conduct its business at public

 

meetings held in compliance with the open meetings act, 1976 PA

 

267, MCL 15.261 to 15.275.

 

     (3) The authority shall do all of the following:

 

     (a) Provide financial support to state or local law

 

enforcement agencies for programs designed to reduce the incidence

 

of automobile insurance fraud and theft.

 

     (b) Provide financial support to state or local prosecutorial

 

agencies for programs designed to reduce the incidence of

 

automobile insurance fraud and theft.

 

     (4) The authority may provide financial support to law

 

enforcement, prosecutorial, insurance, education, or training

 

associations for programs designed to reduce the incidence of


 

automobile insurance fraud and theft, including offering rewards

 

for information that results in the successful prosecution of civil

 

or criminal cases.

 

     (5) The purposes, powers, and duties of the authority are

 

vested in and exercised by a board of directors. The board of

 

directors consists of 15 members as follows:

 

     (a) Nine members who represent automobile insurers in this

 

state subject to the following:

 

     (i) At least 2 members must represent insurer groups with

 

350,000 or more car years.

 

     (ii) At least 2 members must represent insurer groups with less

 

than 350,000 but 100,000 or more car years.

 

     (iii) At least 1 member must represent insurer groups with less

 

than 100,000 car years.

 

     (b) The director or his or her designee.

 

     (c) The attorney general or his or her designee.

 

     (d) Two members selected from a list comprising the names of 3

 

individuals nominated by the department of state police, 3

 

individuals nominated by the Michigan sheriffs' association, and 3

 

individuals nominated by the Michigan association of chiefs of

 

police.

 

     (e) One member who represents prosecuting attorneys in this

 

state.

 

     (f) One member who represents the general public.

 

     (6) Automobile insurers doing business in this state shall

 

select the insurer members on the board under subsection (5) from a

 

list of nominees proposed by the board of governors of the


 

facility. In preparing the list of nominees for the insurer

 

members, the board of governors of the facility shall solicit

 

nominations from automobile insurers doing business in this state.

 

     (7) The governor shall appoint the law enforcement members to

 

the board under subsection (5) with the advice and consent of the

 

senate. In appointing the law enforcement members, the governor

 

shall not appoint a member who represents the same type of law

 

enforcement agency as the other member who represents law

 

enforcement agencies on the board.

 

     (8) The governor shall appoint the prosecuting attorney member

 

to the board under subsection (5) with the advice and consent of

 

the senate.

 

     (9) The governor shall appoint the public member to the board

 

under subsection (5) with the advice and consent of the senate. The

 

public member must be a resident of this state and not be employed

 

by or under contract with any state or local unit of government or

 

any insurer.

 

     (10) Except as otherwise provided in this subsection, a member

 

of the board serves for a term of 4 years and until his or her

 

successor is appointed and qualified. For the members first

 

selected or appointed under this section, 3 insurer members and 1

 

law enforcement member shall serve for a term of 2 years; 3 insurer

 

members, the prosecuting attorney member, and the general public

 

member shall serve for a term of 3 years; and 3 insurer members and

 

1 law enforcement member shall serve for a term of 4 years.

 

     Sec. 6104a. (1) Members of the board shall serve without

 

compensation for their membership on the board, except that members


 

of the board are entitled to receive reasonable reimbursement for

 

necessary travel and expenses.

 

     (2) A majority of the members of the board constitute a quorum

 

for the transaction of business at a meeting, or the exercise of a

 

power or function of the authority, notwithstanding the existence

 

of 1 or more vacancies. Notwithstanding any other provision of law,

 

action may be taken by the authority at a meeting upon a vote of

 

the majority of its members present in person or through the use of

 

amplified telephonic equipment, if authorized by the bylaws or plan

 

of operation of the board. The authority shall meet at the call of

 

the chair or as may be provided in the bylaws of the authority.

 

Meetings of the authority may be held anywhere in this state.

 

     (3) The board shall adopt a plan of operation by a majority

 

vote of the board. Vacancies on the board shall be filled in

 

accordance with the plan of operation.

 

     (4) The board shall conduct its business at meetings that are

 

held in this state, open to the public, and held in a place that is

 

available to the general public. However, the board may establish

 

reasonable rules to minimize disruption of a meeting of the board.

 

At least 10 days but not more than 60 days before a meeting, the

 

board shall provide public notice of the meeting at the board's

 

principal office and on a publicly accessible internet website. The

 

board shall include in the public notice of its meeting the address

 

where minutes of the board may be inspected by the public. The

 

board may meet in a closed session for any of the following

 

purposes:

 

     (a) To consider the hiring, dismissal, suspension, or


 

disciplining of officers or employees of the authority.

 

     (b) To consult with its attorney.

 

     (c) To comply with state or federal law, rules, or regulations

 

regarding privacy or confidentiality.

 

     (5) The board shall display information concerning the

 

authority's operations and activities, including, but not limited

 

to, the annual financial report required under section 6110, on a

 

publicly accessible internet website.

 

     (6) The board shall keep minutes of each board meeting. The

 

board shall make the minutes open to public inspection and

 

available at the address designated on the public notice of its

 

meetings. The board shall make copies of the minutes available to

 

the public at the reasonable estimated cost for printing and

 

copying. The board shall include all of the following in the

 

minutes:

 

     (a) The date, time, and place of the meeting.

 

     (b) The names of board members who are present and board

 

members who are absent.

 

     (c) Board decisions made during any portion of the meeting

 

that was open to the public.

 

     (d) All roll call votes taken at the meeting.

 

     Sec. 6104b. Before January 2, 2016, the department of state

 

police shall transfer all assets of the automobile theft prevention

 

authority to the facility for the benefit of the Michigan

 

automobile insurance fraud and theft prevention authority.

 

     Sec. 6105. The authority shall have board has the powers

 

necessary or convenient to carry out and effectuate the purposes


 

and provisions of this chapter and the purposes of the authority

 

and the powers delegated by other laws its duties under this act,

 

including, but not limited to, the power to do the following:

 

     (a) Sue and be sued ; to have a seal and alter the same at

 

pleasure; to have perpetual succession; to make, execute, and

 

deliver contracts, conveyances, and other instruments necessary or

 

convenient to the exercise of its powers; and to make and amend

 

bylaws in the name of the authority.

 

     (b) Solicit and accept gifts, grants, loans, funds collected

 

and placed in the automobile theft prevention fund, and other aids

 

from any person or the federal, state, or a local government or any

 

agency thereof.

 

     (c) Make grants and investments.

 

     (d) Procure insurance against any loss in connection with its

 

property, assets, or activities.

 

     (e) Invest any money held in reserve or sinking funds, or any

 

money not required for immediate use or disbursement, at its

 

discretion and to name and use depositories for its money.

 

     (f) Contract for goods and services and engage personnel as is

 

necessary. , including the services of private consultants,

 

managers, counsel, auditors, and others for rendering professional,

 

management, and technical assistance and advice, payable out of any

 

money of the fund legally available for this purpose.

 

     (g) Indemnify and procure insurance indemnifying any member of

 

the board from personal loss or accountability from liability

 

resulting from a member's action or inaction as a member of the

 

board.


 

     (h) Do all other things necessary or convenient to achieve the

 

objectives and purposes of the authority, this chapter, or other

 

laws.Perform other acts not specifically enumerated in this section

 

that are necessary or proper to accomplish the purposes of the

 

authority and that are not inconsistent with this chapter or the

 

plan of operation.

 

     Sec. 6107. (1) Prior to Before April 1 of each year, each an

 

insurer or self-insurer engaged in writing insurance coverages

 

which that provide the security required by section 3101(1) within

 

in this state, as a condition of its authority to transact

 

insurance in this state, shall pay to the authority facility, for

 

deposit into the account of the authority, an assessment equal to

 

$1.00 multiplied by the insurer's total earned car years of

 

insurance providing the security required by section 3101(1)

 

written in this state during the immediately preceding calendar

 

year.determined by the facility as provided in the plan of

 

operation. The assessment to each insurer and self-insurer must be

 

based on the ratio of its car years written to the statewide total

 

car years for all insurers and self-insurers.

 

     (2) Money received pursuant to under subsection (1), and all

 

other money received by the facility on behalf of the authority,

 

shall be segregated and placed in a fund to be known as the

 

automobile theft prevention fund. The automobile theft prevention

 

fund shall be administered by the authority.from other money of the

 

facility, if applicable, and shall only be expended as directed by

 

the board.

 

     (3) Money in the automobile theft prevention fund shall be


 

expended in the following order of priority:

 

     (a) To pay the costs of administration of the authority.

 

     (b) To achieve the purposes and objectives of this chapter,

 

which may include, but not be limited to, the following:

 

     (i) Provide financial support to the department of state police

 

and local law enforcement agencies for economic automobile theft

 

enforcement teams.

 

     (ii) Provide financial support to state or local law

 

enforcement agencies for programs designed to reduce the incidence

 

of economic automobile theft.

 

     (iii) Provide financial support to local prosecutors for

 

programs designed to reduce the incidence of economic automobile

 

theft.

 

     (iv) Provide financial support to judicial agencies for

 

programs designed to reduce the incidence of economic automobile

 

theft.

 

     (v) Provide financial support for neighborhood or community

 

organizations or business organizations for programs designed to

 

reduce the incidence of automobile theft.

 

     (vi) Conduct educational programs designed to inform automobile

 

owners of methods of preventing automobile theft and to provide

 

equipment, for experimental purposes, to enable automobile owners

 

to prevent automobile theft.

 

     (4) Money in the automobile theft prevention fund shall only

 

be used for automobile theft prevention efforts and shall be

 

distributed based on need and efficacy as determined by the

 

authority.


 

     (5) Money in the automobile theft prevention fund shall not be

 

considered state money.

 

     (3) From the money received annually under subsection (1), the

 

board shall not reduce the amount of money available to provide

 

financial support for programs designed to reduce the incidence of

 

automobile theft below $6,000,000.00.

 

     Sec. 6108. (1) An insurer authorized to transact automobile

 

insurance in this state, as a condition of its authority to

 

transact insurance in this state, shall report automobile insurance

 

fraud data to the authority using the format and procedures set

 

forth by the board.

 

     (2) The department of state police shall cooperate with the

 

authority and shall provide available motor vehicle fraud and theft

 

statistics to the authority on request.

 

     Sec. 6110. (1) The authority shall develop and implement a

 

plan of operation.

 

     (2) The plan of operation shall include an assessment of the

 

scope of the problem of automobile theft, including particular

 

areas of the state where the problem is greatest; an analysis of

 

various methods of combating the problem of automobile theft and

 

economic automobile theft; a plan for providing financial support

 

to combat automobile theft and economic automobile theft; and an

 

estimate of the funds required to implement the plan.

 

     (3) The authority shall report annually on or before February

 

1 to the governor and the legislature on its activities in the

 

preceding year.Beginning January 1, 2017, the authority shall

 

prepare and publish an annual financial report and an annual report


 

to the legislature on its efforts to prevent automobile insurance

 

fraud and cost savings that have resulted from its efforts under

 

this chapter.

 

     Sec. 6111. (1) By July 1 of every odd even numbered year, the

 

automobile theft prevention authority shall prepare a report that

 

details the theft of automobiles and automobile insurance fraud

 

occurring in this state for the previous 2 years, assesses the

 

impact of the thefts and fraud on rates charged for automobile

 

insurance, summarizes prevention programs, and outlines allocations

 

made by the authority. The director of the department of state

 

police, members of the board, insurers, and the commissioner

 

director shall cooperate in the development of the report as

 

requested by the automobile theft prevention authority and shall

 

make available records and statistics concerning all of the

 

following:

 

     (a) For automobile thefts, including the number of automobile

 

thefts, number of prosecutions and convictions involving automobile

 

thefts, and automobile theft recidivism. The automobile theft

 

prevention

 

     (b) For automobile insurance fraud, the number of instances of

 

suspected and confirmed insurance fraud, number of prosecutions and

 

convictions involving automobile insurance fraud, and automobile

 

insurance fraud recidivism.

 

     (2) In the report required by this section, the authority

 

shall evaluate the impact automobile theft and automobile insurance

 

fraud has on the citizens of this state and the costs incurred by

 

the citizens through insurance, police enforcement, prosecution,


 

and incarceration due to automobile thefts and automobile insurance

 

fraud.

 

     (3) The authority shall submit the report required by this

 

section shall be submitted to the senate and house of

 

representatives standing committees on insurance issues and the

 

commissioner.director.

 

     Enacting section 1. Section 6103 of the insurance code of

 

1956, 1956 PA 218, MCL 500.6103, is repealed effective January 1,

 

2016.

 

     Enacting section 2. The title and sections 4501, 6101, 6105,

 

6107, 6110, and 6111 of the insurance code of 1956, 1956 PA 218,

 

MCL 500.4501, 500.6101, 500.6105, 500.6107, 500.6110, and 500.6111,

 

as amended by this amendatory act, and sections 6104a and 6108 of

 

the insurance code of 1956, 1956 PA 218, as added by this

 

amendatory act, take effect January 1, 2016.

 

     Enacting section 3. This amendatory act does not take effect

 

unless Senate Bill No.____ or House Bill No.____ (request no.

 

02982'13 a) of the 97th Legislature is enacted into law.