Michigan Catastrophic Claims Association Explained: 2025 Updates
⏳ What is MCCA?
Created by the state legislature in 1978, the MCCA is a private nonprofit that functions like an insurer of insurers. Michigan is the only state that offers unlimited lifetime medical coverage through its no-fault system. The MCCA reimburses insurers once PIP medical expenses exceed the retention level, currently set at $635,000 until June 30, 2025.
💰 2025 MCCA Assessment Fees
Drivers help fund the MCCA through a yearly per-vehicle assessment, passed along in auto premiums:
- $90 for unlimited PIP coverage (pure premium $70 + $20 deficit recoupment)
- $20 for all other PIP coverage levels (deficit recoupment only)
In 2024–25, these fees helped address a $2 billion deficit and support future catastrophic claims. New data shows that starting July 1, 2025, insurers will retain an additional $40,000 per claim before the MCCA begins reimbursement, better protecting the fund.
📊 MCCA’s Financial Health
As of December 31, 2023, MCCA’s assets stood at approximately $21.6 billion, with liabilities near $23.7 billion, a $2.1 billion shortfall (91% funded).
Over its history, MCCA has handled more than 48,000 catastrophic claims, paying out over $23 billion since 1978. In 2023 alone, it covered $1.26 billion in PIP medical benefits.
🏍️ Exceptions & Special Cases
Some vehicles pay reduced assessments:
- Historic vehicles: Pay just 20% of the standard rate (~$18 per year)
- Motorcycles: Pay the same $90 (if unlimited) or $20 (other levels)
However, since no-fault PIP doesn’t cover motorcycles, these fees solely contribute to meeting general fund obligations. 👉 Click the link to see the option of purchasing additional medical coverage under a motorcycle insurance policy in Michigan.
⚖️ Why It Matters to You
Without MCCA, vehicle owners would either
- Face catastrophic medical bills, or
- Try to sue at-fault drivers, or
- Rely on private health insurance, or
- Go without critical care.
🔎 Want More Info?
The Insurance Information Institute offers a helpful overview of how no-fault systems work and how catastrophic claims are handled nationally. Learn more here.
📣 Final Takeaway & Action Steps
Michigan’s unique no-fault system provides lifelong medical coverage—but it costs more than in other states. If you choose unlimited PIP coverage—or if the fund has a deficit—you’ll pay a yearly assessment. To understand your options, talk to an agent about choosing the right PIP level and how much your total annual premium will be.
👉 Get a free Michigan auto insurance quote with MCCA included.