Rates

1. Can companies charge the MCCA Deficit Recoupment, even when PIP coverage has been rejected?
   
   Yes. Insurers can charge for the deficit recoupment, but they must still meet the rollback requirements.
2. Section 3104(20) was amended to require that if a company “passes on any portion of the premium payable under this section to an insured” the passed-on amount must equal the portion attributable to the car, including any excesses or deficiencies. What is the intent of this amendment?
   
   Companies will no longer be allowed to file MCCA rates that are more than those charged by MCCA.
3. Will insurance score filings need to be resubmitted for approval?
   
   Companies will be required to demonstrate compliance with MCL 500.2111(4) if the insurance score is based solely or in part on a credit score as defined in MCL 500.2151(e).
4. Will DIFS be mandating geographical territorial definitions since postal zones are now prohibited?
   
   No. Companies will be required to file their territorial definitions demonstrating they comply with the statute.
5. Do the prohibited rating factors outlined in Sec. 2111(4) only apply to PIP medical coverage or all auto coverages?
   
   The rating factor prohibitions apply to automobile insurance not just PIP.
6. Does the 8-year rate reduction only apply to the PIP premium?
   
   Yes. The statute requires compliance with the premium reduction requirements for PIP for policies issued or renewed before July 2, 2028.

The following questions were posted on 10/11/19.

1. What is the appropriate MCCA premium charge for motorcycles?
   
   The appropriate premium charge for motorcycle insurers remains the full MCCA premium charged for unlimited coverage. Motorcycle insurance companies are assessed by the MCCA just like auto insurance companies. While motorcycle policies do not include Personal Injury Protection (PIP) benefits, motorcyclists are still entitled to PIP medical benefits if they are injured in an accident involving a motor vehicle. Therefore, motorcycle insurers are required to pay an assessment to the MCCA for all motorcycles they insure, which is typically passed on to the motorcycle policyholder.
2. Do multi-policy discounts offered for the purchase automobile insurance coupled with other insurance products(home, tenant, condo, etc.) violate the prohibition on the establishment of rates or rating classifications based on home ownership?
   
   DIFS will ensure that a multi-policy discount is not used as a surrogate for home ownership by requiring companies to file rules and rates governing multi-policy discounts. If discounts are offered on home insurance policies, the discount cannot be limited to homeowners only and the amount cannot vary by product (home, tenant, condo, etc.).

The following questions were posted on 12/06/19.

ZIP Codes

1. Can postal codes be grouped together and rated on a territorial basis? If not, how are companies allowed to group geographical locations together (county, city, etc.)?

   Territories may not be based on postal zones (i.e. zip codes). This includes grouping a set of zip codes together and making one or more territories. Companies may set their territories on a method that is not based on zip code or a group of zip codes.

The following questions were posted on 04/02/20.

1. Do the mandated PIP premium reductions apply to commercial automobile policies?
   
   No.  As the mandated PIP premium reductions are included in Chapter 21,  they are not applicable to commercial automobile policies.
    

2. If my company is a member of a rating organization that promulgates loss costs (e.g. ISO), do I still have to demonstrate compliance with the mandated PIP premium reductions?
   
   Yes.  Companies that are adopting loss costs for private passenger automobile insurance are required to demonstrate compliance with the PIP premium reductions in MCL 500.2111f using the company’s average premiums.  Note that as to companies adopting loss costs for commercial automobile insurance, the PIP premium reductions do not apply.