March 15, 2005

Governor Calls for Public Input into Rate Decisions

LANSING – Governor Jennifer M. Granholm today called on the Legislature to inject accountability into the operations of the Michigan Catastrophic Claims Association (MCCA) by supporting efforts to provide for public access to MCCA meetings and operations.
 
“Tomorrow, the MCCA, a private association run by a small group of insurance executives, will meet behind closed doors to determine how much more Michigan drivers will have to pay for automobile insurance,” said Granholm.  “The public needs to have a say in this process, and I call on the Legislature to add sunshine to the process of setting our citizens’ auto insurance rates.”
 
Senate Bills 152 and 153, introduced with bi-partisan support by Sen. Mark Schauer, and House Bills 4140 and 4141, introduced by Rep. Lee Gonzalez, would add a member of the general public to the MCCA board.  The bills would also require that the MCCA be included under the Freedom of Information Act (FOIA) and Open Meetings Act (OMA.)  House Bill 4112, introduced by Rep. Glenn Anderson, will increase the MCCA board to nine members, including three members of the general public.  Rep. Michael Sak is expected to introduce similar legislation this week.
 
Last year, MCCA rates were raised to record highs.  The rates are determined by five insurance executives who assess the reserve amount needed for the MCCA fund.  Because the MCCA is a statutorily established private association, it isn’t subject to FOIA or OMA laws.  There is also no public member on the current board who can represent the interests of the millions of insurance rate payers 
 
“It’s certainly appropriate during ‘Sunshine Week’ to demand more accountability and transparency on the MCCA and its decision making process,” Granholm said.  “Michigan drivers are paying the tab and have the right to hold the MCCA accountable and to know how their auto rates have been set.”
 
Granholm has declared the week of March 13 Sunshine Week in Michigan to encourage more government access for the citizens of Michigan who have the right to know how public officials are representing them and spending their tax dollars.
 
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