December 18, 2014, Introduced by Rep. Cavanagh and referred to the Committee on Insurance.
A bill to amend 1956 PA 218, entitled
"The insurance code of 1956,"
by amending section 3037 (MCL 500.3037), as amended by 1980 PA 461.
THE PEOPLE OF THE STATE OF MICHIGAN ENACT:
Sec. 3037. (1) Automobile collision insurance for a vehicle
may be offered and issued by the same insurance company that
provides coverage under chapter 31 for the vehicle or by a
different insurance company.
(2)
(1) At the time a new an applicant
for the insurance
required
by section 3101 for a private passenger nonfleet
automobile
makes an initial written
application to for
automobile
collision
insurance, the insurer ,
an insurer shall offer both of
the following collision coverages to the applicant:
(a)
Limited collision coverage, which shall pay pays for
collision damage to the insured vehicle without a deductible amount
when
if the operator of the vehicle is not substantially at
fault
in the accident from which the damage arose.
(b)
Broad form collision coverage, which shall pay pays for
collision damage to the insured vehicle regardless of fault, with
deductibles
in such amounts as may be approved by the commissioner,
director,
which deductibles shall will be
waived if the operator of
the vehicle is not substantially at fault in the accident from
which the damage arose.
(3) (2)
In addition to the coverages
offered pursuant to under
subsection
(1), (2), standard and limited collision coverage may be
offered
with deductibles as approved by the commissioner.director.
(4) (3)
Where When the applicant is required by the insurer to
sign
the written application form described in subsection (1), (2),
if the applicant chooses to reject both of the collision coverages,
or limited collision without a deductible, offered under subsection
(1),
(2), the rejection shall be made in writing,
either on a
separate form or as part of the application, or in some combination
thereof,
of a separate form and as
part of the application, as
approved
by the commissioner. director.
The rejection statement
shall
must inform the applicant of his or her rights in the
event
of
if there is damage to the insured vehicle under the alternative
coverage option selected.
(5) (4)
In the case of If a written application is made by
mail, if the applicant fails to sign or return a written rejection
statement
as required by subsection (3), (4),
the requirements of
subsection
(3) (4) shall be considered to have been satisfied with
respect to the insurer if all of the following occur:
(a)
The application provides the applicant with an opportunity
to select the coverages required to be offered under subsection
(1).(2).
(b) The applicant is requested to sign the rejection
statement, either as part of the application or as a separate form
issued with the application, if the applicant fails to select
either
of the coverages specified in subsection (1).(2).
(c)
The applicant signed signs
the application as otherwise
required by the insurer.
(6) (5)
At the time of the initial written
application
specified
in under subsection (1), (2), an
agent or insurer shall
provide the applicant with a written explanation of collision
coverage options in easily understandable language, if that
information is not contained in the application form.
(7) (6)
At least annually in conjunction
with the renewal of a
private
passenger nonfleet an automobile collision
insurance
policy, or at the time of an addition, deletion, or substitution of
a vehicle under an existing policy, other than a group policy, an
insurer shall inform the policyholder, on a form approved by the
commissioner,
director, of all of the following:
(a) The current status of collision coverage, if any, for the
vehicle or vehicles affected by the renewal or change and the
rights
of the insured in the event of damages to if the insured
vehicle is damaged under the current coverage.
(b) The collision coverages available under the policy and the
rights
of the insured in the event of if
there is damage to the
insured vehicle under each collision option.
(c) Procedures for the policyholder to follow if he or she
wishes to change the current collision coverage.
(8) (7)
As used in this section:
(a) "Collision damage" does not include losses customarily
insured under comprehensive coverages.
(b) "Substantially at fault" means a person's action or
inaction was more than 50% of the cause of the accident.
(8)
This section shall take effect March 1, 1980.