Michigan Judge Says Car Insurance Fund Records are Public

An insurance fund that slaps a fee on every Michigan car to pay for catastrophic injuries suffered in accidents has been ordered to open its books and demonstrate how it sets the annual rate.

The decision by an Ingham County judge could shed more light on the Michigan Catastrophic Claims Association, which was created by the Legislature to reimburse insurance companies for claims that exceed $500,000.

Michigan’s no-fault insurance law provides unlimited lifetime coverage for medical expenses tied to auto wrecks. Michigan drivers now pay $175 per car per year – a sum that’s up 67 percent since 2008 – on top of other charges by their insurer.

“It’s plain and simple: This is the public’s money, and the public has a right to know all the facts about how their money is managed and whether what they pay in premiums is adequate to handle future claims,” said John Cornack, president of the Coalition Protecting Auto No-Fault, a group of health care, labor and consumer organizations.

The coalition and the Brain Injury Association of Michigan sued after the catastrophic claims association said it was a private group and turned down a public-records request. Judge Clinton Canady III said the MCCA was created by law and fits the definition of “public body.”

“Michigan citizens have a right to know how the insurance they pay is calculated to ensure that no-fault insurance is provided on a fair and equitable basis,” the judge said in a 13-page decision dated Dec. 26.

Canady said the association must release information about rate calculation, the number of claims, administrative expenses and the amount of money in reserve. No personal information will be released.

The association’s executive director, Gloria Freeland, said the judge’s decision was being reviewed.

The information “is already available on public websites and included in financial statements,” Freeland said Wednesday.

But Mike Dabbs, president of the Brain Injury Association, disagreed. He said certain details about claims can help people judge the health of the fund without jeopardizing anyone’s privacy.

“What’s been requested is how they set their rates,” he said. “How can they prove they’re good stewards of our public money? That’s not on their website. The public is owed some explanation.”