Bill
SB 872
The bill authorizes and funds the Department of Insurance and Financial Services for FY 2026-27, including 3 new FTEs, a deferred presentment database, and a one-time auto insuranc
Jurisdiction: Michigan
Bill Title: Appropriations: Department of Insurance and Financial Services; appropriations for fiscal year 2026-2027; provide for. Creates appropriation act.
Sponsors: Senator Mary Cavanagh (Co-sponsor)
Status: Reported favorably with substitute (S-1); referred to Committee of the Whole with substitute. Action history indicates introduction and subsequent committee actions in 2026.
Purpose and Intent
- SB 872 proposes to authorize and provide all state funding for the Department of Insurance and Financial Services (DIFS) for the fiscal year ending September 30, 2027 (FY 2026-27).
- It establishes the department’s appropriation act and outlines how the funds may be expended, including changes to FTE (full-time equivalent) positions and funding sources.
Key Provisions and Changes
- Overall Funding and FTE Counts:
- FY 2026-27 Senate-recommended budget for DIFS:
- Gross: $82,583,800 (up from FY 2025-26 baseline)
- Adjusted Gross after interdepartmental grants: $81,792,200
- Net state spending: $81,542,200
- Interdepartmental grants received: $791,600
- Federal funds: $250,000
- Local/Private funds: $0
- Total state spending across restricted funds: $81,542,200
- FTEs: 393.5 (up from 390.5 in FY 2025-26 baseline)
- Major Budget Adjustments and Additions:
1) Deferred Presentment Contract Increase:
- +$1,400,000 gross to support operation and maintenance of a deferred presentment database (per PA 244 of 2005).
2) Economic Adjustments:
- +$1,061,400 gross (no GF/GP impact listed) for total economic adjustments.
3) New Programs/Program Increases (New FTEs for Departmental Support):
- 2.0 restricted-FTEs to support Consumer Services and Protection.
- 1.0 FTE to support Insurance Evaluation.
- Total: +$466,000 (restricted funds) for these new FTEs.
4) One-Time Appropriation – Non-Driving Factors Study:
- +$250,000 from the Insurance Bureau Fund for a study of non-driving factors used in personal auto insurance rate calculations.
- Non-CSB (Central Service Budget) vs. CSB (Central Services Budget) Changes:
- Non-CSB ongoing changes include the new departmental support FTEs totaling 3.0 FTEs with $466,000.
- CSB ongoing changes show economic adjustments totaling $1,031,700 (gross) and a salaries component of $29,700.
- One-time change includes the non-driving factors study: $250,000.
- Deleted and Modified Provisions from FY 2025-26:
- Deleted sections include: 225 (E-Verify Requirement), 304 (238 Report), 305 (Marijuana-related business manuals), 306 (Auto Insurance Filing report), 307 (Customer Service Outreach FTE).
- Modified sections include: 204 (Internet reporting requirements), 228 (LDSI Requirements), 301 (Annual rate filing from health insurance issuers), 307 (Auto Insurance Coverage Assistance), 401 (Non-driving factors study).
- Overall Fiscal Note:
- The measure reflects a net increase in gross appropriations for FY 2026-27 relative to FY 2025-26, with the primary changes centered on extending and expanding departmental capabilities (additional FTEs, deferred presentment database support, and a one-time study).
Who Would Be Affected
- The Department of Insurance and Financial Services (DIFS) would receive and administer the appropriated funds.
- DIFS programs and operations would be affected by:
- Expansion of staff (2.0 FTE for Consumer Services/Protection and 1.0 FTE for Insurance Evaluation).
- Enhanced data and IT capabilities via the deferred presentment database.
- A one-time study funded to examine non-driving factors in auto insurance rate setting.
- Insurance-related stakeholders, such as consumers, insurers, and auto insurance ratepayers, could be affected indirectly through enhanced services, oversight, and potential rate analysis improvements.
Procedural and Timeline Aspects
- Fiscal Year Coverage: Appropriations cover FY 2026-27 (funds expended through September 30, 2027).
- Enactment Path: Passed by the Senate Appropriations process with a substitute (S-1) and moved through committee and to the Committee of the Whole for consideration.
- Major boilerplate changes indicate a shift in reporting and programmatic requirements (deletions and modifications to multiple sections), signaling potential simplifications or adjustments to existing reporting and regulatory requirements.
- Effective date specifics are not provided beyond the fiscal year scope; typical implementation would align with the start of FY 2026-27 and continue through FY 2027.
Notes
- Figures reflect the Senate’s recommended appropriation as of February 11, 2026, with revisions noted in the Subcommittee and full Senate appropriations documents (dated April 2026).
- The document consistently labels the budget as “INSURANCE AND FINANCIAL SERVICES BUDGET” for FY 2026-27.
Compiled from official sources — confirm details with the bill’s official record.
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