WHAT IS AN INSURER UNDER MCL 500.3114(4)?

Jacqueline W. August

In the unpublished Court of Appeals decision, Advanced Surgery Ctr, LLC v Farm Bureau Gen Ins Co of Mich et al, the Court of Appeals held that the word “insurer” in former MCL 500.3114(4)(a) “refers only to a particular insurer that has agreed to provide no-fault insurance to an owner or registrant as required by MCL 500.3101(1) or MCL 500.3102(1).”

The claimants, Varanda and Tequilla Byrd, were involved in a motor vehicle accident. Varanda was driving a vehicle she rented from Enterprise which was owned by EAN Holdings, LLC (“EAN”). EAN is a self-insured entity registered in Florida. As the claimants did not have their own no-fault insurance policy, the Michigan Assigned Claims Plan assigned claimants’ claim for benefits to Farm Bureau. Varanda received treatment from Plaintiff and assigned her rights to Plaintiff.

Plaintiff filed a Complaint against Farm Bureau seeking reimbursement for services it provided. Farm Bureau then filed a third-party complaint against EAN asserting that EAN, as the owner of the vehicle, was highest in priority. EAN filed a motion for summary disposition arguing it was not required to provide PIP benefits since the vehicle was not registered in Michigan and had not been used in Michigan for more than 30 days in the past calendar year. The Circuit Court agreed.

On appeal, the Court of Appeals analyzed and applied the Michigan Supreme Court’s recently issued decision in Turner by Sakowski v Farmers Ins Exch, ___ Mich ___ (1/29/21). The Turner Court interpreted the previous MCL 500.3114(4) in a case with facts nearly identical to those in the present case. The Turner Court, relying in part on Parks v DAIIE, 426 Mich 191; 393 NW2d 833 (1986), held that the word “insurer” in former MCL 500.3114(4)(a) “refers only to a particular insurer that has agreed to provide no-fault insurance to an owner or registrant as required by MCL 500.3101(1) or MCL 500.3102(1).” Thus, the self-insured in that case could not have constituted the “insurer of the owner or registrant of the vehicle” occupied. Turner, supra.

Similar to Turner and Parks, the Advanced Surgery Court determined that the vehicle Varanda was operating was an out-of-state vehicle that was not required to be registered in Michigan and not subject to the security provisions of the No-Fault Act since it had not been operated in Michigan for more than 30 days within the past calendar year. Because EAN was not required to obtain no-fault insurance for the vehicle, EAN could not have constituted the “insurer of the owner or registrant of the vehicle occupied” under former MCL 500.3114(4)(a).  The Advanced Surgery Court affirmed that EAN was not the insurer of highest priority for payment of PIP benefits and affirmed the trial court’s grant of summary disposition in EAN’s favor.