LANSING, Mich. (Nov. 13, 2024) — Today, Sen. Mary Cavanagh (D-Redford Twp.) introduced a comprehensive bill package to ensure greater accountability and transparency in the insurance industry and better serve millions of Michigan consumers. Cosponsored by Sens. Rosemary Bayer (D-West Bloomfield), Veronica Klinefelt (D-Eastpointe), and Stephanie Chang (D-Detroit), Senate Bills 1087–1090 work to bolster the Michigan Dept. of Insurance and Financial Services’ (DIFS) enforcement of insurance code regulations and expand the department’s ability to discipline offenders.
“As lawmakers, one of our top responsibilities is to protect the people and communities that we represent — this bill package achieves exactly that by strengthening insurance regulations and penalties for bad actors who take advantage of Michigan insurance consumers,” said Sen. Cavanagh. “As Chair of the Committee on Finance, Insurance, and Consumer Protection, I’m confident that this legislation will create a more transparent, equitable insurance system for our residents — and I’m proud of our unwavering efforts to continue placing the hardworking people of our state first and foremost, the way it should be.”
DIFS plays a crucial role in holding insurers accountable to Michigan consumers, but current law limits the department’s ability to effectively enforce violations. Senate Bills 1087-1090 address these limitations and further enable DIFS to issue punishments and regulate the actions of insurers. More specifically:
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Senate Bill 1087 (Cavanagh) increases civil penalties for violations of the insurance code;
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Senate Bill 1088 (Bayer) expands penalties for insurers that pay claims late;
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Senate Bill 1089 (Klinefelt) amends the insurance code to prohibit post-claim underwriting;
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Senate Bill 1090 (Chang) amends the insurance code to require insurers to comply with utilization reviews.
“Michigan residents deserve an insurance system they can rely on,” said Sen. Klinefelt. “This legislation will better protect consumers from unfair practices, such as post-claim underwriting, that undermine trust in our insurance system.”
“Insurance provides Michigan consumers with peace of mind, knowing they have safeguards in place if and when disaster strikes,” said Sen. Chang. “Yet, for too long, some insurers in our state have been able to get away with policy malpractice and violation of state regulations, ultimately harming Michigan residents in the process. By mandating insurers to comply with DIFS’ orders, my bill would help ensure Michigan residents can access the full range of coverage and care they need.”
Senate Bills 1087-1090 have been referred to the Senate Committee on Finance, Insurance, and Consumer Protection where they currently await further deliberation.
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