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Q

Do you have to pay Michigan's catastrophic claims fee on a motorcycle policy?


A

Yes, with a motorcycle insurance policy in Michigan, you will be charged a Michigan Catastrophic Claims Association (MCCA) assessment fee.

Michigan is unique with its motor vehicle insurance policies. Every insurance company writing personal auto or motorcycle insurance in Michigan is required to pay an assessment to the MCCA.

The assessment is per vehicle and is the same for most all vehicles, the exception being historic vehicles/motorcycles, which have a lower assessment amount. That MCCA cost is then passed on to policyholders, like you, as a portion of your policy premium.

Your insurer will assess an MCCA amount per each vehicle on your policy, whether it is a car or motorcycle you are insuring. While each insurer is assessed the same amount per vehicle, what an insurer charges you for the MCCA fee may vary because insurance companies are allowed to include administrative and other miscellaneous fees in the amount they pass onto you.

So, if you have car insurance through one company and your motorcycle insurance through another, then each may charge a different fee for what they list as the MCCA assessment.

Motorcyclists aren’t required to purchase personal injury protection (PIP) like car owners are, so motorcyclists aren’t covered in the same way that auto drivers are for PIP benefits; thus, we can see why you asked if the MCCA fee is assessed on motorcycle policies.

As you probably know, unless a motorcyclist is injured by an accident with another motor vehicle, the person is not entitled to the unlimited PIP benefits. Therefore, if you hit a tree instead of a car, you couldn’t claim for the no-fault benefits. If you purchased medical benefits, offered in $5,000 increments, as part of your motorcycle policy, then that coverage would be used (up to its limits) for your injuries.

If, however, you are on your motorcycle and in an accident with an automobile, then you should be eligible to claim for unlimited PIP benefits under the car’s no-fault policy.

So, while your own motorcycle policy doesn’t provide for the unlimited no-fault benefits directly, the amount of claims that motorcyclists place for PIP benefits in Michigan makes it a requirement for the MCCA assessment.

The MCCA says that about 2% of assessments paid into them are from motorcycle policies, but over 7% of claims paid by them have been to motorcyclists.


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