What is this MCCA Deficit Recoupment line item on my policy?
Short answer: This fee is required for every vehicle* on every auto policy in Michigan (regardless of the PIP Medical limit you have selected) and is the same amount with every insurance company. The money doesn’t go to your insurance company, but rather, through your insurance company. A nonprofit entity called the Michigan Catastrophic Claims Association (MCCA) manages these funds to pay the medical bills of people who were catastrophically injured in an auto accident. You can visit the MCCA website for more information.
Longer answer building on the shorter one: The specific line item is newer for Pioneer. Prior to the law being changed in 2019, the MCCA charges, fees, and any deficit recoupment were all rolled into one line item on your policy. This is because every policy was required to carry Unlimited PIP Medical coverage, and these fees were the same for everyone. With the change in the law the fees varied based on your PIP Medical coverage selection, so we broke out the different pieces of it for clarity.
At first, if you had looked, you would have seen that the MCCA Deficit Recoupment line was $0. That was true for every vehicle on every policy (regardless of insurance company, though we can’t say every company itemized things the way we have).
However, recently there have been some court rulings which altered the way claims are required to be paid under the new laws (including a case still under consideration by the Michigan Supreme Court: Andary v. USAA Casualty Insurance Co.), and the MCCA had to adjust their budget accordingly. Given the new changes, they realized they were not collecting quite enough per vehicle to cover the expenses into the foreseeable future. Hence the updated fee.
If you have further questions, your Independent Agent is always your best resource for information about your policy and coverages!
* Vehicles kept in storage and/or trailers are not subject to this fee.