Last Updated on November 30, 2025 by The Insurance Pros
Michigan Catastrophic Claims Association Explained: 2025 Updates
The Michigan Catastrophic Claims Association (MCCA) plays a major role in the state’s no-fault system. It reimburses insurers for extremely high medical claims so drivers can continue to access lifetime medical coverage. Below is what drivers need to know for 2025, including updated fees, financials, and retention changes.
⏳ What Is the MCCA?
Created in 1978, the MCCA is a private nonprofit that supports Michigan’s unique no-fault auto system. Michigan is the only state that offers lifetime unlimited medical coverage for accident injuries.
The MCCA reimburses auto insurers after a claimant’s medical costs exceed the retention level, which is the amount insurers must pay before the MCCA starts covering additional expenses.
💰 2025 MCCA Assessment Fees
Every insured vehicle contributes to the MCCA through an annual assessment included in Michigan auto premiums. Rates for the 2024–2025 period:
- $90 per vehicle for drivers choosing unlimited PIP medical
(includes $70 pure premium + $20 deficit recoupment) - $20 per vehicle for drivers choosing any other PIP medical level
(deficit recoupment only)
The $20 fee is required due to the MCCA’s multi-year deficit. Unlimited PIP drivers pay more because they benefit directly from the catastrophic coverage the MCCA supports.
📊 MCCA Financial Health
Recent financial statements show the MCCA continues to carry a deficit. As of December 31, 2023:
- Assets: approximately $21.6 billion
- Liabilities: approximately $23.7 billion
- Funding ratio: 91 percent (about a $2.1 billion deficit)
Since 1978, the MCCA has reimbursed more than 48,000 catastrophic injury claims and paid out over $23 billion. Claims related to traumatic brain injury, spinal cord damage, and long-term nursing care remain the largest cost drivers.
🏍️ Vehicles With Special Rates
Certain vehicles qualify for a reduced annual assessment:
- Historic vehicles: Pay 20 percent of the unlimited PIP rate (about $18 per year)
- Motorcycles: Pay $90 (unlimited) or $20 (other PIP levels)
Motorcycles pay into the fund even though no-fault PIP coverage does not apply to them. They contribute because the MCCA supports the overall structure of Michigan’s no-fault system. Riders can buy optional medical benefits under a separate
Michigan motorcycle insurance policy.
⚖️ Why the MCCA Matters
Without the MCCA, Michigan drivers would face large financial risks. Drivers might:
- Face unlimited medical expenses after a severe crash
- Rely solely on health insurance with strict limits
- Attempt to sue at-fault drivers for full cost of care
- Go without essential long-term treatment
The MCCA allows Michigan to offer one of the most generous medical coverage systems in the country, even though it comes with added cost.
🔎 Want to Learn More?
The Insurance Information Institute provides a helpful overview of no-fault insurance and catastrophic claims across the U.S.
View the overview here.
📣 Final Takeaway & Next Steps
The MCCA plays a major role in Michigan’s auto premiums, especially for drivers choosing unlimited PIP coverage. Understanding how assessments work and how they change in 2025 can help you make better coverage decisions.
