When do car insurance checks go out

MICHIGAN, USA — Governor Gretchen Whitmer and the Michigan Department of Insurance and Financial Services (DIFS) Director Anita Fox announced Monday that $400 refund checks will start hitting Michigander's mailboxes this week.

Owners of a vehicle that was insured under a policy that meets the minimum insurance requirements for operating a vehicle on Michigan roads as of 11:59 p.m. on October 31, 2021 will receive a $400 check per vehicle insured, or $80 per historic vehicle insured. The deadline for the checks to be sent by insurers is no later than May 9, but many Michiganders could be receiving their check(s) starting this week.

“These $400 refunds are game-changers for so many Michigan families,” said Gov. Whitmer. “I called for these refunds because I am committed to lowering costs for Michiganders and putting money back in people’s pockets. They are possible because we worked across the aisle to pass bipartisan auto insurance reform, and we will keep working together to grow our economy and build a state where families can thrive.”

The refund is from a $3 billion surplus in funds from the Michigan Catastrophic Claims Association (MCCA) fund that is used to ensure continuity of care for catastrophic accident survivors. The MCCA is still maintaining approximately $2 billion in surplus funds to ensure continuity of care for catastrophic accident survivors. 

"After Governor Whitmer called on the MCCA to issue these refunds and the MCCA announced its plan, DIFS issued guidance to auto insurers to ensure that these refunds are sent out as quickly as possible, and in no case later than May 9, 2022,” said Fox. 

“Our goal is to make sure that Michiganders understand the eligibility requirements and to help ensure that this money makes it into consumers’ pockets as quickly and securely as possible. DIFS stands ready to answer questions or help resolve any concerns that Michiganders may have regarding their refunds,” Fox added in a statement on Monday.

The refund has been met with opposition because many catastrophic accident survivors are now being left with reduced care and increased medical bills. The $2 billion in surplus dollars left in the fund is meant to continue care for these individuals but many are saying it is not enough.

The bipartisan auto insurance reform bill that released these funds to the public was signed into law by Gov. Whitmer in 2019 and in Dec. 2021, the MCCA voted unanimously to return approximately $3 billion of surplus funds to Michiganders.

Eligible consumers who do not receive their refunds by the deadline should contact their auto insurer or agent.

For more information on the refunds, visit the Department of Insurance and Financial Services frequently asked questions page.

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It was recently announced that Michigan drivers are getting some money back, but why?

LANSING, Mich. - Refund checks worth hundreds of dollars should be arriving in the bank accounts of Michigan drivers over the next few months. 

The $400 refund checks that are being delivered from the state's auto insurance industry are part of the bipartisan-passed legislation in 2019, which required the companies that oversee the state's trust fund to return money to drivers who insured a vehicle in Michigan by the end of October last year.

The refund checks should arrive by May 9, Gov. Gretchen Whitmer said.

Whitmer took credit for the refund checks during her annual State of the State Address earlier in January, where she attributed her signing of the auto insurance reform package as a cost-saving measure for drivers.

The money will come from the Michigan Catastrophic Claims Association (MCCA), which reported a billion-dollar surplus last year. 

RELATED: Here's how auto insurance changed in Michigan this year

According to the state, drivers that insured their vehicle by 11:59 p.m. on Oct. 31, 2021 will receive a refund. Motorcycles and RVs are eligible for the refund as well, as long as they have minimum insurance requirements. 

The money is scheduled to be transferred by the MCCA to insurers by March 9. From there, checks will be issued through mail or ACH deposit. 

Among the biggest changes from the auto insurance reform was the requirement removal that all drivers pay for unlimited Personal Injury Protection medical coverage. Drivers that opted out of maximum PIP coverage will still get a refund.

RELATED: Drivers to receive $400 refund checks per vehicle

The details of the refunds were published in a bulletin released by the Department of Insurance and Financial Services.

"The Governor directed DIFS to take an active role in ensuring that refunds would be issued expeditiously to Michiganders who have paid into the fund for decades," said Director Anita Fox. "The DIFS bulletin ensures that consumers are protected and imposes a May 9, 2022 deadline for issuing refunds to all eligible drivers."

DIFS also created a FAQ site for drivers to peruse if they have any questions.

Any drivers that are eligible to receive a refund but don't get a check by the May 9 deadline can contact their insurance company with questions. They may also contact the insurance department with concerns Monday through Friday 8 a.m. to 5 p.m. at 833-ASK-DIFS (833-275-3437) or emailing .

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The refund follows a request by Gov. Gretchen Whitmer who called on the MCCA to send checks back to drivers after the group registered a projected $5 billion surplus in November.

LANSING, Mich. - When will auto insurance refunds be available to Michigan drivers?

According to the governor, all refund checks will be issued to drivers no later than May 9, 2022.

Gov. Gretchen Whitmer said last week that Michigan drivers would receive $400 checks for every vehicle they own that's insured in the state. The money will come from the Michigan Catastrophic Claims Association (MCCA), which reported a billion-dollar surplus.

The refunds are part of bipartisan-passed legislation that was signed in 2019. If a resident had a vehicle insured as of 11:59 p.m. on Oct. 31, 2021, they will receive a refund. Motorcycles and RVs are eligible for the refund as long as they have minimum insurance requirements.  

RELATED: Here's how auto insurance changed in Michigan this year

The money is scheduled to be transferred by the MCCA to insurers by March 9. From there, checks will be issued through mail or ACH deposit. 

"Michigan used to have the highest auto insurance rates in the nation, but we worked together to put Michiganders first, significantly lowering the cost of insurance and putting $400 per vehicle back in driver’s pockets while continuing to provide access to the most generous benefits in the nation," said Whitmer. 

Among the biggest changes from the auto insurance reform was the requirement removal that all drivers pay for unlimited Personal Injury Protection medical coverage. Drivers that opted out of maximum PIP coverage will still get a refund.

RELATED: Drivers to receive $400 refund checks per vehicle

The details of the refunds were published in a bulletin released by the Department of Insurance and Financial Services.

"The Governor directed DIFS to take an active role in ensuring that refunds would be issued expeditiously to Michiganders who have paid into the fund for decades," said Anita Fox. "The DIFS bulletin ensures that consumers are protected and imposes a May 9, 2022 deadline for issuing refunds to all eligible drivers."

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Michigan's auto insurance laws are changing.

DIFS also created a FAQ site for drivers to peruse if they have any questions.

Any drivers that are eligible to receive a refund but don't get a check by the May 9 deadline can contact their insurance company with questions. They may also contact the insurance department with concerns Monday through Friday 8 a.m. to 5 p.m. at 833-ASK-DIFS (833-275-3437) or emailing .

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Your car was damaged or totaled in a crash. Once your auto insurance claim is finalized, you may be entitled to a payout. But how does this work? Do you receive a check? Does the payment go to your lender instead? Can you spend any extra cash that doesn’t go toward repairing or replacing your car?

The answers to those questions probably aren’t as obvious as the damage to your vehicle. Several factors can complicate the process. Here’s what’s involved in cashing out a car insurance claim check after a crash.

Related: How to make a car insurance claim

How Do You Get Paid for an Auto Insurance Claim?

How you get paid for an insurance claim can depend on if you make a claim with your own insurance company or another driver’s, and if you own your car or not.

When you make a claim with your insurance company

A payment from an auto insurance claim that you file with your insurer typically goes to the person or entity that owns the vehicle, says Mark Friedlander, a spokesperson for the industry-backed Insurance Information Institute.

If you finance your car, it’s common for the lender to require that you list them on your car insurance policy, which means they will also be named on claims checks.

Here are three scenarios:

• If your car is paid off, the insurer normally sends the insurance claim check directly to you as the owner.
• If you still owe money on a car loan, the lender most likely will receive the insurance check, but in some cases the check may be written out to both you and the lender.
• If the car is leased, the claim payout goes to you and the leasing company.

In cases where the check is made out to you and a leasing or finance company, Friedlander says the leasing company or lender would need to endorse the check before you cash it.

Usually, the lender or leasing company will require you to fix the vehicle, and may even ask you to sign the check over to them, and allow them to pay the auto body shop directly. Or they may have you show proof through photos or other documentation that the car is fixed, and then sign the check and send it to you to pay the bill.

When you make a claim with someone else’s insurance company

The insurance claim payout situation differs if the payment comes from another driver’s insurance company. This may happen, for example, if another driver hits you and you file a claim against their liability car insurance.

If you make a claim against someone else’s car insurance, typically the claim check will be written only in your name, Friedlander says. But if you’ve got a loan or lease, you may be required to spend the insurance money on repairs. State regulations can play a part in how the payout is handled, according to Friedlander.

You will not be required to pay a deductible if you make a claim through the other driver’s insurance company. But here’s something to consider: The other insurance company may not agree that their driver is entirely 100% at fault. That means the insurance company may only pay a portion of your claim.

Related: Comparative negligence laws in car insurance claims

Summary: Who Gets an Auto Insurance Claims Check?

What Happens When a Repair Shop is Involved?

Depending on the insurance company, your claim check might be sent directly to the repair shop, especially if the shop is a preferred shop of your auto insurance company, Friedlander says. The insurance check also might be made out jointly to you and the repair shop.

Although the insurer may recommend a repair shop, you can choose any repair shop you’d like.

The sum of money you wind up with if your car is being repaired will be based on the estimated cost to fix the damage and coverage limits outlined in your policy, minus any deductible that applies.

Can You Cash Out an Auto Insurance Claim Check and Spend It?

If you own your car outright, meaning you owe no money to a lender or leasing company, you can spend an insurance claim payment however you want, according to Friedlander. This is also usually the case if the payment is from another driver’s insurance company.

But if you have a loan or lease on the car, the lender or leasing company may restrict how the payment can be spent and might even demand proof that the money went toward repairs, Friedlander says.

If insurance money is left over after repairs are made, you normally don’t need to return the surplus unless your auto insurance policy states otherwise, Friedlander explains.

“The repair shop is generally expected to complete repairs per the insurer’s estimate. If there are leftover funds, the difference is usually insignificant,” he notes.

What Happens With a Claim Check for a Totaled Car?

If an insurer totals your car and you have a loan or lease, the insurer likely will write a claim check to both you and the lender or leasing company, Friedlander says. In most cases, the lender or leasing company will take their cut first, with any surplus money going to you.

Be aware that you might owe the lender or leasing company more money than the amount of the claim payout. In this situation, you must come up with the difference between the claim payout and the loan or lease balance, according to Friedlander. If you have gap insurance, it will cover the balance you have on a loan or lease when your car is totaled and you owe more than it’s worth.

If a claim payout for a totaled car comes from another driver’s insurance company, you’ll need to settle details about distribution of the money with your lender or leasing company, he adds.

An insurer looks at factors such as the type of damage, the severity of the damage and the age of the car before deciding whether the vehicle should be fixed or be declared a total loss. If you made a claim under your collision or comprehensive coverage, the most your insurance company would pay out for your totaled car is the value of the car right before the accident, minus your deductible amount.