HB-4427, As Passed Senate, December 7, 2016

SENATE SUBSTITUTE FOR

HOUSE BILL NO. 4427

     A bill to amend 1956 PA 218, entitled

"The insurance code of 1956,"

by amending section 2103 (MCL 500.2103), as amended by 2002 PA 492.

THE PEOPLE OF THE STATE OF MICHIGAN ENACT:

     Sec. 2103. (1) "Eligible person", for automobile insurance,

means a person who is an owner or registrant of an automobile

registered or to be registered in this state or who holds a valid

Michigan license to operate a motor vehicle issued by this state,

but does not include any of the following:

     (a) A person who is not required to maintain security pursuant

to under section 3101, unless the person intends to reside in this

state for 30 days or more and makes a written statement of that

intention on a form approved by the commissioner.director.

     (b) A person whose license to operate a vehicle is under

suspension or revocation.

     (c) A person who has been convicted within the immediately

preceding 5-year period of fraud or intent to defraud involving an

insurance claim or an application for insurance; or an individual

who has been successfully denied, within the immediately preceding

5-year period, payment by an insurer of a claim in excess of

$1,000.00 under an automobile insurance policy, if there is

evidence of fraud or intent to defraud involving an insurance claim

or application.

     (d) A person who, during the immediately preceding 3-year

period, has been convicted under, or who has been subject to an

order of disposition of the family division of circuit court for a

violation of, any of the following:

     (i) Section 324 or 325 of the Michigan penal code, 1931 PA

328, MCL 750.324 and 750.325; section 1 of former 1931 PA 214 or

section 626c of the Michigan vehicle code, 1949 PA 300, MCL

257.626c; Section 601d of the Michigan vehicle code, 1949 PA 300,

MCL 257.601d, or under any other law of this state the violation of

which constitutes a felony resulting from the operation of a motor

vehicle.

     (ii) Section 625 of the Michigan vehicle code, 1949 PA 300,

MCL 257.625.

     (iii) Section 617, 617a, 618, or 619 of the Michigan vehicle

code, 1949 PA 300, MCL 257.617, 257.617a, 257.618, and 257.619.

     (iv) Section 626 of the Michigan vehicle code, 1949 PA 300,

MCL 257.626; or for a similar violation under the laws of any other

state or a municipality within in or without outside of this state.

     (e) A person whose vehicle insured or to be insured under the

policy fails to meet the motor vehicle safety requirements of

sections 683 to 711 of the Michigan vehicle code, 1949 PA 300, MCL

257.683 to 257.711.

     (f) A person whose policy of automobile insurance has been

canceled because of nonpayment of premium or financed premium

within the immediately preceding 2-year period, unless the premium

due on a policy for which application has been made is paid in full

before issuance or renewal of the policy.

     (g) A person who fails to obtain or maintain membership in a

club, group, or organization, if membership is a uniform

requirement of the insurer as a condition of providing insurance,

and if the dues, charges, or other conditions for membership are

applied uniformly throughout this state, are not expressed as a

percentage of premium, and do not vary with respect to the rating

classification of the member except for the purpose of offering a

membership fee to family units. Membership fees may vary in

accordance with the amount or type of coverage if the purchase of

additional coverage, either as to type or amount, is not a

condition for reduction of dues or fees.

     (h) A person whose driving record for the 3-year period

immediately preceding application for or renewal of a policy, has,

pursuant to under section 2119a, an accumulation of more than 6

insurance eligibility points.

     (2) "Eligible person", for home insurance, means a person who

is the owner-occupant or tenant of a dwelling of any of the

following types: a house, a condominium unit, a cooperative unit, a

room, or an apartment; or a person who is the owner-occupant of a

multiple unit dwelling of not more than 4 residential units.

Eligible person does not include any of the following:

     (a) A person who has been convicted, in the immediately

preceding 5-year period, of 1 or more of the following:

     (i) Arson, or conspiracy to commit arson.

     (ii) A crime under sections 72 to 77, 112, 211a, 377a, 377b,

or 380 of the Michigan penal code, 1931 PA 328, MCL 750.72 to

750.77, 750.112, 750.211a, 750.377a, 750.377b, and 750.380.

     (iii) A crime under section 92, 151, 157b, or 218 of the

Michigan penal code, 1931 PA 328, MCL 750.92, 750.151, 750.157b,

and 750.218, based upon on a crime described in subparagraph (ii)

committed by or on behalf of the person.

     (b) A person who has been successfully denied, within the

immediately preceding 5-year period, payment by an insurer of a

claim under a home insurance policy based on evidence of arson,

conspiracy to commit arson, fraud, or conspiracy to commit fraud,

committed by or on behalf of the person.

     (c) A person who insures or seeks to insure a dwelling that is

being used for an illegal or demonstrably hazardous purpose.

     (d) A person who refuses to purchase an amount of insurance

equal to at least 80% of the replacement cost of the property

insured or to be insured under a replacement cost policy.

     (e) A person who refuses to purchase an amount of insurance

equal to at least 100% of the market value of the property insured

or to be insured under a repair cost policy.

     (f) A person who refuses to purchase an amount of insurance

equal to at least 100% of the actual cash value of the property

insured or to be insured under a tenant or renter's home insurance

policy.

     (g) A person whose policy of home insurance has been canceled

because of nonpayment of premium within the immediately preceding

2-year period, unless the premium due on the policy is paid in full

before issuance or renewal of the policy.

     (h) A person who insures or seeks to insure a dwelling, if the

insured value is not any of the following:

     (i) For a repair cost policy, at least $15,000.00.

     (ii) For a replacement policy, at least $35,000.00 or another

amount which the commissioner established by the director. The

director may establish an amount under this subparagraph biennially

on and after January 1, 1983, pursuant to rules by a rule

promulgated by the commissioner under the administrative procedures

act of 1969, 1969 PA 306, MCL 24.201 to 24.328, and based upon on

changes in applicable construction cost indices.

     (i) A person who insures or seeks to insure a dwelling that

has physical conditions that clearly present an extreme likelihood

of a significant loss under a home insurance policy.

     (j) A person whose real property taxes with respect to the

dwelling insured or to be insured have been and are delinquent for

2 or more years at the time of renewal of, or application for, home

insurance.

     (k) A person who has failed to procure or maintain membership

in a club, group, or organization, if membership is a uniform

requirement of the insurer, and if the dues, charges, or other

conditions for membership are applied uniformly throughout this

state, are not expressed as a percentage of premium, and do not

vary with respect to the rating classification of the member except

for the purpose of offering a membership fee to family units.

Membership fees may vary in accordance with the amount or type of

coverage if the purchase of additional coverage, either as to type

or amount, is not a condition for reduction of dues or fees.

     (3) "Home insurance" means any of the following, but does not

include insurance intended to insure commercial, industrial,

professional, or business property, obligations, or liabilities:

     (a) Fire insurance for an insured's dwelling of a type

described in subsection (2).

     (b) If contained in or indorsed to a fire insurance policy

providing insurance for the insured's residence, other insurance

intended primarily to insure nonbusiness property, obligations, and

liabilities.

     (c) Other insurance coverages for an insured's residence as

prescribed by rule promulgated by the commissioner pursuant to

director under the administrative procedures act of 1969, 1969 PA

306, MCL 24.201 to 24.328. A The director shall transmit a rule

proposed for promulgation by the commissioner pursuant to under

this section shall be transmitted in advance to each member of the

standing committee committees in the house of representatives and

in the senate that has have jurisdiction over insurance.

     (4) "Insurance eligibility points" means all of the following:

     (a) Points calculated, according to the following schedule,

for convictions, determinations of responsibility for civil

infractions, or findings of responsibility in probate court:

     (i) For a violation of any lawful speed limit by more than 15

miles per hour, or careless driving, 4 points.

     (ii) For a violation of any lawful speed limit by more than 10

miles per hour , but less than 16 miles per hour, 3 points.

     (iii) For a violation of any lawful speed limit by 10 more

than 5 miles per hour but less than 11 miles per hour, or less, 2

points.

     (iv) For a violation of any speed limit by 15 more than 5

miles per hour but less than 16 miles per hour or less on a roadway

that had a lawfully posted maximum speed of 70 miles per hour or

greater as of January 1, 1974, 2 points.

     (v) For a violation of a speed limit by less than 6 miles per

hour, 1 point.

(vi) (v) For all other moving violations pertaining to the

operation of motor vehicles, 2 points.

     (b) Points calculated, according to the following schedule,

for determinations that the person was substantially at-fault: , as

defined in section 2104(4):

     (i) For the first substantially at-fault accident, 3 points.

     (ii) For the second and each subsequent substantially at-fault

accident, 4 points.

     (5) "Insurer" means an insurer authorized to transact in this

state the kind or combination of kinds of insurance constituting

automobile insurance or home insurance. , as defined in this

chapter.

     Enacting section 1. This amendatory act takes effect 1 year

after the date it is enacted into law.