HB 5134 Summary

• Creates the Michigan Automobile Insurance Fraud Authority as a 25-member board within the Michigan Automobile Insurance Placement Facility to reduce insurance fraud and unfair claims practices, with authority dissolving January 1, 2021.

• Requires automobile insurers in municipalities with populations of 500,000 or more (or where 35% or more of vehicles lack required insurance) to file rates that reduce annual premiums by at least 12% by December 31 of the year the bill takes effect.

• Modifies personal protection insurance benefits by allowing insurers to offer deductibles and copayment requirements at reduced premium rates, and requires hospitals to file 2015 chargemaster rates and limit billing to insurers to 80% of hospital charges for inpatient, outpatient, rehabilitation, and skilled nursing facility services.

• Establishes that insurers refusing to pay claims or unreasonably delaying payment are presumed to have acted unreasonably, rebuttable only by clear and convincing evidence, and requires electronic claim documentation acceptance by January 1, 2017.

• Authorizes the Michigan Automobile Insurance Fraud Authority to fund state and local law enforcement, prosecutorial agencies, and an independent entity to investigate insurer claims practices, with insurers and self-insurers assessed up to $21 million annually through 2020 from non-premium earnings.