Michigan Court of Appeals; Docket No. 156716; Unpublished
Judges Gribbs, White, and Foley; Unanimous; Per Curiam
Official Michigan Reporter Citation: Not Applicable; Link to Opinion 
STATUTORY INDEXING:
Reimbursement of Member Claims [§3104]
Nonresident Claimants [§3104]
Obligations of Admitted Insurers to Pay PIP Benefits on Behalf of Nonresidents Injured in Michigan [§3163(1)]
TOPICAL INDEXING:
Not Applicable
CASE SUMMARY:
In this unanimous per curiam unpublished Opinion, the Court of Appeals upheld the trial court ruling that the Michigan Catastrophic Claims Association was not obligated to indemnify Travelers Insurance for no-fault benefits it paid to a passenger of its insured involved in a single vehicle accident in Michigan.
Travelers sought indemnification from the MCCA for amounts it paid in excess of $250,000 to a passenger of its insured involved in a Michigan motor vehicle accident. Indemnification was sought pursuant to the provisions of MCLA 500.3104(2). The MCCA denied indemnification on the grounds that it is obligated to indemnify only those insurers who provide the coverage required by MCLA 500.3101(1):
Each insurer engaged in writing insurance coverages which provide the security required by [§3101(1)] within this state, as a condition of its authority to transact insurance in this state, shall be a member of the association and shall be bound by the plan of operation of the association...
Under certain circumstances, insurers can be required to pay PIP benefits pursuant to §3163(1) of the no-fault act, on policies issued to "out of state residents." Such insurers are not, however, entitled to indemnification from the MCCA with respect to payments made under those policies, because those policies do not provide the security required by §3101(1), and the insurers have not paid an assessment to the MCCA with respect to such policies.
In the instant case, the insured, Stewart Case, was a resident of Michigan. In June, 1988, he was sent by his employer to work temporarily in Pennsylvania. He continued to work in Pennsylvania for approximately 18 months, ultimately obtained a Pennsylvania driver's license, purchased a vehicle in 1989 in Pennsylvania, registered the vehicle in 1989, and obtained a six month insurance policy in his name issued by Travelers Insurance in Pennsylvania. There is no dispute that this policy was not a Michigan no-fault policy. During the term of this policy, Case returned to Michigan, and was in Michigan for more than 30 days when he became involved in an accident on December 9,1989. The accident occurred during the policy term of the Travelers policy. Case had not obtained a Michigan's driver's license or registered the truck in Michigan. Case's passenger was injured, and Travelers paid PIP benefits to the passenger which exceeded $250,000. When Travelers sought indemnification from the MCCA, its request was denied on the grounds that the provisions of §3104(1) do not require indemnification where the benefits have not been paid pursuant to a policy required by §3101(1).
In affirming the trial court grant of summary disposition in favor of the MCCA, the Court of Appeals rejected Travelers' argument that it was entitled to indemnification because Case was a resident of Michigan and the MCCA provides indemnification for losses sustained by members under policies of insurance issued to residents of the state of Michigan. The court also rejected Travelers' argument that since Case became a resident of Michigan while the policy was in effect, Travelers had satisfied the criteria to be entitled to indemnification from the MCCA.
The Court of Appeals held that the operative factor is whether PIP benefits are paid pursuant to a policy providing coverage under §3101. Whether the policy was written in Michigan is irrelevant. Also irrelevant, except as it bears on the question of whether benefits are paid pursuant to §3101 or §3163, is the residence of the insured at the time of the accident. The court held that if Travelers had changed the policy to a Michigan policy and made the appropriate adjustments to the premium and the amounts paid to the MCCA, the MCCA would be liable to indemnify Travelers under §3104. However, Travelers did not establish that it had indeed changed the policy to a Michigan policy.
