LANSING — Michigan drivers will continue to see a dramatically lower Michigan Catastrophic Claims Association (MCCA) per-vehicle assessment fee next year than before the 2019 auto no-fault reforms took effect, thanks to strong fiscal management and the ongoing impact of the reforms.
“When we look at the data, we can clearly see the positive effects of the reforms, with out-of-control medical costs decreasing for many of the costliest procedures,” said executive director Kimberly Bezy. “Prior to passage of the reforms in 2019, drivers paid $220 for every vehicle. Starting July 2026, the fee will be $84 for drivers selecting unlimited Personal Injury Protection and $19 for those selecting other coverage limits.”
The new annual assessment fee, to take effect July 2026, will be $19 for drivers selecting less than unlimited Personal Injury Protection (PIP) coverage. That is down from the current $23 fee. The fee for drivers selecting unlimited coverage will increase from $82 to $84, an increase that is lower than the rate of inflation.
The MCCA announced the new fee today after a careful and thorough review of its finances and expected expenditures in the coming year. The per-vehicle assessment is comprised of two parts: a pure premium and a deficit recoupment charge.
The pure premium reflects the funds needed to reimburse insurance companies that are required to cover unlimited lifetime costs of care for people injured in catastrophic accidents anticipated to occur during the coming fiscal year. The pure premium is only paid by those who select unlimited PIP coverage.
By state law, the deficit recoupment charge is added when the MCCA’s estimated liabilities, discounted to present value, exceed the MCCA’s assets. The estimated liabilities are the amount of money the MCCA estimates it will reimburse insurance companies to pay for the lifetime care of accident victims. To make up the deficit, the MCCA is required to charge an additional per-vehicle amount to all drivers.
The current and new MCCA per-vehicle assessment fees are listed below.
| Pure Premium | Deficit Recoupment | Assessment for Drivers Selecting Unlimited | Assessment for Drivers Selecting Other Limit |
2025/2026 | $59 | $23 | $82 ($59 + $23) | $23 |
2026/2027 | $65 | $19 | $84 ($65 + $19) | $19 |
The deficit recoupment charge is dropping because of improved investment performance in the second half of the fiscal year. The pure premium is increasing slightly due to higher projected costs for long-term care services, particularly agency attendant care and residential care, which has risen at a rate significantly higher than the rate of inflation, due in part to court decisions issued regarding the 2019 reforms.
“Thanks to the MCCA’s strong financial stability, Michigan is able to offer the most generous auto insurance benefits in the country,” Bezy said. “We are proud to continue working to support a stable, sustainable insurance market and make Michigan’s unique auto no-fault coverage more accessible and more affordable.”
