MI HB5827

Creates the catastrophic claims association as an unincorporated nonprofit association requiring all insurers writing personal protection insurance in Michigan to be members.

Association provides indemnification for 100% of ultimate losses under personal protection insurance exceeding threshold amounts that increase biennially from $500,000 (as of July 1, 2013) by the lesser of 6% or the consumer price index, rounded to the nearest $5,000.

Establishes a board of directors consisting of 5 members appointed by the director of the insurance department, with members representing at least 40% of total premiums calculated by the association.

Requires the association to deposit money only with financial institutions maintaining a principal office or branch in the United States, including banks and savings and loan associations with deposits insured by federal government agencies.

Association members must report claims that may involve the association, maintain loss and expense data, and pay premiums calculated based on each member's written car years of insurance multiplied by average premium per car across all members.