Auto insurance bills to rise due to deficit in catastrophic fund

DETROIT (WXYZ) — On the heels of countless Michigan drivers receiving refund checks of $400 per vehicle after changes to state law, 7 Action News is learning information about a new deficit in the state catastrophic fund.

It’s part of an annual report from the Michigan Catastrophic Claims Association, a nonprofit organization.

“When they made that judgement, the stock market was very high,” said Peggy Campbell, whose sister is paralyzed from the chest down following a crash.

Another advocate against the refund checks, Chalisse Wilson, also has a brother who suffered catastrophic injuries.

“I was very angry. We spent a lot of time telling them it wasn’t a good idea,” said Wilson who has taken part in protests and spoken out against the refunds.

The checks were touted publicly by the governor as a way of giving back to drivers. Now, auto insurance bills could soon have a noticeable change due to a deficit of $3.7 billion.

It’s expected to create an additional $48 fee for drivers, according to the MCCA.

“It was wrong from the beginning,” Wilson said.

Reasons cited in the annual report include a court overturning retroactive elimination of benefits for victims, declines in the stock market and those refund checks. However, not all are concerned including state Rep. Joe Bellino from Monroe.

“When the market recovers and the fund picks up more, we’ll get rebate checks again in the future, yes,” Bellino said.

Another local leader, Detroit City Councilwoman Mary Waters, is also weighing in.

“I’m very concerned because the Legislature tried to fix it and it’s not fixed. Somebody needs to go back to the drawing board,” Waters said.

Many are expected to see the changes beginning in July.

The governor’s office has not responded to our request for comment on the report

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