October 4, 2011, Introduced by Senators KAHN, MARLEAU and PAPPAGEORGE and referred to the Committee on Insurance.
A bill to amend 1956 PA 218, entitled
"The insurance code of 1956,"
by amending sections 2111, 3103, 3114, and 3177 (MCL 500.2111,
500.3103, 500.3114, and 500.3177), section 2111 as amended by 2002
PA 492, section 3103 as amended by 1986 PA 173, section 3114 as
amended by 2002 PA 38, and section 3177 as amended by 1984 PA 426.
THE PEOPLE OF THE STATE OF MICHIGAN ENACT:
Sec. 2111. (1) Notwithstanding any provision of this act and
this chapter to the contrary, classifications and territorial base
rates used by any insurer in this state with respect to automobile
insurance or home insurance shall conform to the applicable
requirements of this section.
(2)
Classifications established pursuant to under this section
for automobile insurance shall be based only upon 1 or more of the
following factors, which shall be applied by an insurer on a
uniform basis throughout the state:
(a) With respect to all automobile insurance coverages:
(i) Either the age of the driver; the length of driving
experience; or the number of years licensed to operate a motor
vehicle.
(ii) Driver primacy, based upon the proportionate use of each
vehicle insured under the policy by individual drivers insured or
to be insured under the policy.
(iii) Average miles driven weekly, annually, or both.
(iv) Type of use, such as business, farm, or pleasure use.
(v) Vehicle characteristics, features, and options, such as
engine displacement, ability of the vehicle and its equipment to
protect passengers from injury, and other similar items, including
vehicle make and model.
(vi) Daily or weekly commuting mileage.
(vii) Number of cars insured by the insurer or number of
licensed operators in the household. However, number of licensed
operators shall not be used as an indirect measure of marital
status.
(viii) Amount of insurance.
(b) In addition to the factors prescribed in subdivision (a),
with respect to personal protection insurance coverage:
(i) Earned income.
(ii) Number of dependents of income earners insured under the
policy.
(iii) Coordination of benefits.
(iv) Use of a safety belt.
(v) For a motorcyclist, use of a crash helmet. As used in this
subparagraph, "crash helmet" means that term as used in section 658
of the Michigan vehicle code, 1949 PA 300, MCL 257.658.
(c) In addition to the factors prescribed in subdivision (a),
with respect to collision and comprehensive coverages:
(i) The anticipated cost of vehicle repairs or replacement,
which may be measured by age, price, cost new, or value of the
insured automobile, and other factors directly relating to that
anticipated cost.
(ii) Vehicle make and model.
(iii) Vehicle design characteristics related to vehicle
damageability.
(iv) Vehicle characteristics relating to automobile theft
prevention devices.
(d) With respect to all automobile insurance coverage other
than comprehensive, successful completion by the individual driver
or drivers insured under the policy of an accident prevention
education course that meets the following criteria:
(i) The course shall include a minimum of 8 hours of classroom
instruction.
(ii) The course shall include, but not be limited to, a review
of all of the following:
(A) The effects of aging on driving behavior.
(B) The shapes, colors, and types of road signs.
(C) The effects of alcohol and medication on driving.
(D) The laws relating to the proper use of a motor vehicle.
(E) Accident prevention measures.
(F) The benefits of safety belts and child restraints.
(G) Major driving hazards.
(H) Interaction with other highway users such as
motorcyclists, bicyclists, and pedestrians.
(3) Each insurer shall establish a secondary or merit rating
plan for automobile insurance, other than comprehensive coverage. A
secondary or merit rating plan required under this subsection shall
provide for premium surcharges for any or all coverages for
automobile insurance, other than comprehensive coverage, based upon
any or all of the following, when that information becomes
available to the insurer:
(a) Substantially at-fault accidents.
(b) Convictions for, determinations of responsibility for
civil infractions for, or findings of responsibility in probate
court for civil infractions for, violations under chapter VI of the
Michigan vehicle code, 1949 PA 300, MCL 257.601 to 257.750.
However,
beginning 90 days after the effective date of this
sentence
May 28, 1996, an insured shall not be merit rated for a
civil infraction under chapter VI of the Michigan vehicle code,
1949 PA 300, MCL 257.601 to 257.750, for a period of time longer
than that which the secretary of state's office carries points for
that infraction on the insured's motor vehicle record.
(4) An insurer shall not establish or maintain rates or rating
classifications for automobile insurance based upon sex or marital
status.
(5) Notwithstanding other provisions of this chapter,
automobile insurance risks may be grouped by territory.
(6)
This section shall does not be construed as limiting limit
insurers or rating organizations from establishing and maintaining
statistical
reporting territories. This section shall does not be
construed
to prohibit an insurer from
establishing or maintaining,
for automobile insurance, a premium discount plan for senior
citizens in this state who are 65 years of age or older, if the
plan is uniformly applied by the insurer throughout this state. If
an insurer has not established and maintained a premium discount
plan for senior citizens, the insurer shall offer reduced premium
rates to senior citizens in this state who are 65 years of age or
older and who drive less than 3,000 miles per year, regardless of
statistical data.
(7)
Classifications established pursuant to under this section
for home insurance other than inland marine insurance provided by
policy floaters or endorsements shall be based only upon 1 or more
of the following factors:
(a) Amount and types of coverage.
(b) Security and safety devices, including locks, smoke
detectors, and similar, related devices.
(c) Repairable structural defects reasonably related to risk.
(d) Fire protection class.
(e) Construction of structure, based on structure size,
building material components, and number of units.
(f) Loss experience of the insured, based upon prior claims
attributable to factors under the control of the insured that have
been paid by an insurer. An insured's failure, after written notice
from the insurer, to correct a physical condition that presents a
risk of repeated loss shall be considered a factor under the
control of the insured for purposes of this subdivision.
(g) Use of smoking materials within the structure.
(h) Distance of the structure from a fire hydrant.
(i) Availability of law enforcement or crime prevention
services.
(8) Notwithstanding other provisions of this chapter, home
insurance risks may be grouped by territory.
(9) An insurer may utilize factors in addition to those
specified in this section, if the commissioner finds, after a
hearing
held pursuant to under the administrative procedures act of
1969, 1969 PA 306, MCL 24.201 to 24.328, that the factors would
encourage innovation, would encourage insureds to minimize the
risks of loss from hazards insured against, and would be consistent
with the purposes of this chapter.
Sec. 3103. (1) An owner or registrant of a motorcycle shall
provide security against loss resulting from liability imposed by
law for property damage, bodily injury, or death suffered by a
person arising out of the ownership, maintenance, or use of that
motorcycle. The security shall conform with the requirements of
section 3009(1).
(2)
Each insurer transacting insurance in this state which
that affords coverage for a motorcycle as described in subsection
(1) also shall offer, to an owner or registrant of a motorcycle who
agrees to wear a crash helmet when riding the motorcycle, security
for the payment of first-party medical benefits only, in increments
of
$5,000.00, payable in the event if
the owner or registrant is
involved in a motorcycle accident. An insurer providing first-party
medical benefits may offer, at appropriate premium rates,
deductibles, provisions for the coordination of these benefits, and
provisions for the subtraction of other benefits provided or
required to be provided under the laws of any state or the federal
government, subject to the prior approval of the commissioner.
These deductibles and provisions shall apply only to benefits
payable to the person named in the policy, the spouse of the
insured, and any relative of either domiciled in the same
household.
(3) An owner or registrant of a motorcycle who does not agree
to wear a crash helmet when riding the motorcycle shall maintain
security for payment of benefits under personal protection
insurance as provided in section 3107. Each insurer described in
this state that affords coverage for a motorcycle as described in
subsection (1) also shall offer, to an owner or registrant of a
motorcycle, security for payment of benefits under personal
protection insurance as provided in section 3107. A certificate of
insurance sold under this subsection shall state that the insurance
satisfies this subsection.
(4) As used in this section, "crash helmet" means that term as
used in section 658 of the Michigan vehicle code, 1949 PA 300, MCL
257.658.
Sec. 3114. (1) Except as provided in subsections (2), (3), and
(5), a personal protection insurance policy described in section
3101(1) applies to accidental bodily injury to the person named in
the policy, the person's spouse, and a relative of either domiciled
in the same household, if the injury arises from a motor vehicle
accident. A personal injury insurance policy described in section
3103(2) applies to accidental bodily injury to the person named in
the policy, the person's spouse, and a relative of either domiciled
in the same household, if the injury arises from a motorcycle
accident. When personal protection insurance benefits or personal
injury benefits described in section 3103(2) are payable to or for
the benefit of an injured person under his or her own policy and
would also be payable under the policy of his or her spouse,
relative, or relative's spouse, the injured person's insurer shall
pay all of the benefits and is not entitled to recoupment from the
other insurer. A personal protection insurance policy described in
section 3103(3) applies to accidental bodily injury to the person
named in the policy, the person's spouse, and a relative of either
domiciled in the same household, if the injury arises from a motor
vehicle accident or a motorcycle accident.
(2) A person suffering accidental bodily injury while an
operator or a passenger of a motor vehicle operated in the business
of transporting passengers shall receive the personal protection
insurance benefits to which the person is entitled from the insurer
of the motor vehicle. This subsection does not apply to a passenger
in the following, unless that passenger is not entitled to personal
protection insurance benefits under any other policy:
(a) A school bus, as defined by the department of education,
providing transportation not prohibited by law.
(b) A bus operated by a common carrier of passengers certified
by the department of transportation.
(c) A bus operating under a government sponsored
transportation program.
(d) A bus operated by or providing service to a nonprofit
organization.
(e) A taxicab insured as prescribed in section 3101 or 3102.
(f) A bus operated by a canoe or other watercraft, bicycle, or
horse livery used only to transport passengers to or from a
destination point.
(3) An employee, his or her spouse, or a relative of either
domiciled
in the same household , who
suffers accidental bodily
injury while an occupant of a motor vehicle owned or registered by
the
employer , shall
receive personal protection insurance benefits
to which the employee is entitled from the insurer of the furnished
vehicle.
(4) Except as provided in subsections (1) to (3), a person
suffering accidental bodily injury arising from a motor vehicle
accident while an occupant of a motor vehicle shall claim personal
protection insurance benefits from insurers in the following order
of priority:
(a) The insurer of the owner or registrant of the vehicle
occupied.
(b) The insurer of the operator of the vehicle occupied.
(5) A person suffering accidental bodily injury arising from a
motor
vehicle accident which that
shows evidence of the involvement
of a motor vehicle while an operator or passenger of a motorcycle
shall claim personal protection insurance benefits from insurers in
the following order of priority:
(a) For a personal protection insurance policy described in
section 3103(3), the motor vehicle insurer of the owner or
registrant of the motorcycle involved in the accident.
(b) (a)
The insurer of the owner or
registrant of the motor
vehicle involved in the accident.
(c) (b)
The insurer of the operator of the
motor vehicle
involved in the accident.
(d) (c)
The motor vehicle insurer of the
operator of the
motorcycle involved in the accident.
(e) (d)
The motor vehicle insurer of the
owner or registrant
of the motorcycle involved in the accident.
(6) If 2 or more insurers are in the same order of priority to
provide personal protection insurance benefits under subsection
(5), an insurer paying benefits due is entitled to partial
recoupment from the other insurers in the same order of priority,
together
with and a reasonable amount of partial recoupment of the
expense of processing the claim, in order to accomplish equitable
distribution of the loss among all of the insurers.
Sec. 3177. (1) An insurer obligated to pay personal protection
insurance benefits for accidental bodily injury to a person arising
out of the ownership, maintenance, or use of an uninsured motor
vehicle as a motor vehicle or motorcycle, as applicable, may
recover such benefits paid and appropriate loss adjustment costs
incurred from the owner or registrant of the uninsured motor
vehicle
or from his or her estate. Failure of such a person liable
to an insurer under this subsection to make payment within 30 days
after a judgment is entered is a ground for suspension or
revocation of his or her motor vehicle or motorcycle registration
and license as defined in section 25 of the Michigan vehicle code,
Act
No. 300 of the Public Acts of 1949, being section 257.25 of the
Michigan
Compiled Laws. An uninsured motor vehicle for the purpose
of
this section is a motor vehicle with respect to which security
is
required by sections 3101 and 3102 is not in effect at the time
of
the accident.1949 PA 300, MCL
257.25.
(2)
The A motor vehicle or motorcycle registration
and license
shall
not be suspended or revoked and the motor vehicle
registration
and license under subsection
(1), or if suspended or
revoked shall be restored, if the debtor enters into a written
agreement with the secretary of state permitting the payment of the
judgment in installments, if the payment of any installments is not
in default.
(3) The secretary of state upon receipt of a certified
abstract of court record of a judgment or notice from the insurer
of an acknowledgment of debt shall notify the owner or registrant
of an uninsured motor vehicle of the provisions of subsection (1)
at that person's last recorded address with the secretary of state
and inform that person of the right to enter into a written
agreement with the secretary of state for the payment of the
judgment or debt in installments.
(4) As used in this section, "uninsured motor vehicle" means a
motor vehicle or motorcycle for which security as required by
section 3101, 3102, or 3103(3) is not in effect at the time of the
accident.