LIMITED BENEFITS NO-FAULT POLICY S.B. 288 (S-3):
SUMMARY OF BILL
REPORTED FROM COMMITTEE
Senate Bill 288 (Substitute S-3 as reported)
CONTENT
The bill would amend the Insurance Code to do the following:
-- Allow an eligible city to contract with one or more insurers to provide qualifying no-fault policies to its residents.
-- Specify that an individual insured under a qualifying no-fault policy, his or her spouse, and a relative of either living in the same household, would be limited to the rights under that policy.
-- Allow a qualifying no-fault policy to limit benefits for critical care to $250,000 for an individual named in the policy, his or her spouse, or a relative of either living in the same household, and to limit other personal protection benefits to $25,000.
-- Provide that, if a qualifying no-fault policy provided a cap of more than $25,000 on personal protection benefits other than critical care, the benefits for critical care could be reduced accordingly, if the total benefits available were at least $275,000.
-- Allow an injured person to receive benefits under the assigned claims plan after benefits under a qualifying no-fault policy were exhausted, unless he or she was insured under that policy, the spouse of the insured person, or a relative of either living in the same household.
-- Allow an insurer that provided a qualifying no-fault policy to create a limited provider network and require an injured individual to receive post-acute care through an in-network provider, as well as obtain preauthorization from the insurer.
-- Permit the Department Director to initiate an administrative or civil action against a qualifying insurer that exhibited a pattern or practice of providing an inadequate network of providers.
-- Prohibit an insurer from issuing a qualifying no-fault policy unless the individual insured signed a written waiver stating that he or she understood that the qualifying no-fault policy offered only limited benefits and not full, unlimited no-fault benefits.
-- Prohibit the Catastrophic Claims Association from charging a member a premium for a car insured under a qualifying no-fault policy.
The bill would define "eligible city" as a city that either 1) has a population of at least 500,000 and a charter provision allowing it to provide insurance to its residents (i.e., Detroit), or 2) presents credible evidence to the Department of Insurance and Financial Services that at least 35% of the city's residents who regularly operate a motor vehicle do so without the personal protection insurance required by the Code.
MCL 500.3101 et al. Legislative Analyst: Ryan M. Bergan
FISCAL IMPACT
The bill would have no fiscal impact on State or local government.
Date Completed: 6-4-15 Fiscal Analyst: Glenn Steffens
This analysis was prepared by nonpartisan Senate staff for use by the Senate in its deliberations and does not constitute an official statement of legislative intent.