No. Though section16(a) of the MVSFA, MCL 492.116(a), permits an installment seller to require a buyer of a motor vehicle under an installment sales contract to provide insurance on such motor vehicle, at the installment buyer's expense, for the protection of the installment seller or subsequent holder against substantial risk of damage, destruction, or theft of the motor vehicle, section 16(b) of the MVSFA, MCL 492.116(b), provides that the buyer enjoys the "privilege of purchasing such insurance from any insurance company, agent or broker authorized to do business in Michigan[.]" Section 16(b) further provides that no "installment seller shall coerce, threaten, or in any way influence any installment buyer to purchase insurance from any insurance company, agent or broker designated by such seller." [Emphasis added.] Additionally, section 31(c) of the MVSFA, MCL 492.131(c), generally prohibits an insurance company, agent, or broker from directly or indirectly paying to an installment seller and prohibits an installment seller from receiving from any insurance company, agent, or broker, any portion of an insurance premium involved in the retail installment sale of a motor vehicle.
Entering into any sort of arrangement or agreement that would directly or indirectly allow an insurance agency access to customers at a dealership or encourage a dealer or its employees or agents to influence or steer an installment buyer towards a certain insurance company, agent, or broker, whether through direct contact, distributing pamphlets, offering on-site kiosks, or applications for installment buyers to shop for or purchase insurance, would violate section 16(b) of the MVSFA, MCL 492.116(b), and any direct or indirect compensation paid by the insurance company to, or received by the installment seller for the purchase of such insurance, may violate the prohibition against sharing premiums under section 31(c).
Please refer to DIFS Declaratory Ruling No. 2001-012-M for further analysis and discussion concerning this issue as well as analysis of Insurance Code provisions that such arrangements may also violate.
The applications can be found on DIFS website. Click Licensing - Consumer Finance and Mortgage, then click Motor Vehicle Installment Seller/Sales Finance Co. (under How to Become Licensed header).
Complete Form FIS 1028. Detailed instructions are included in the application.DIFS encourages you to type the application as the on-line application contains “fillable” fields.
Complete Form FIS 2311. Detailed instructions are included in the application. DIFS encourages you to type the application as the on-line application contains “fillable” fields.
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Amendment instructions can be found on DIFS website. Click Licensing - Consumer Finance and Mortgage, then click Motor Vehicle Installment Seller/Sales Finance Co. (under Once You Are Licensed header).
Renewal instructions and FAQs can be found on DIFS website. Click Licensing - Consumer Finance and Mortgage, then click Motor Vehicle Installment Seller/Sales Finance Co. (under Renewals header).
